medicaid expansionAs we know by now, the expansion of Medicaid was one of the major points of contention within the Affordable Care Act. Although the Supreme Court upheld the expansion in a June 2012 decision, it limited the federal government’s ability to penalize states that did not comply with the mandate. As a result, participation at the state level became optional. Despite this evolving situation, the Congressional Budget Office (CBO) projects that 11 million Americans will gain coverage by 2022 as a consequence of this provision.

To date, only 25 states and the District of Columbia have elected to expand Medicaid coverage, with dismal Medicaid expansion projections for several other states. Although the division is not strictly along party lines, most of the states that have accepted the Medicaid Expansion have democratic governors. One notable exception is Ohio Governor John Kasich (R), who forced approval of the Medicaid expansion by working around the state legislature. Kasich contends that this move will create a healthier workforce, an advantage that he expects will attract new business to the state.

States that have expanded Medicaid coverage include:

  1. Arizona: Governor Jan Brewer (R)
  2. Arkansas: Governor Mike Beebe (D)
  3. California: Governor Jerry Brown (D)
  4. Colorado: Governor John Hickenlooper (D)
  5. Connecticut: Governor Dannel Malloy (D)
  6. Delaware: Governor Jack Markell (D)
  7. Hawaii: Governor Neil Abercrombie (D)
  8. Illinois: Governor Pat Quinn (D)
  9. Iowa: Governor Terry Branstad (R)
  10. Kentucky: Steve Beshear (D)
  11. Maryland: Governor Martin O’Malley (D)
  12. Massachusetts: Governor Deval Patrick (D)
  13. Michigan: Governor Rick Snyder (R)
  14. Minnesota: Governor Mark Dayton (D)
  15. Nevada: Governor Brian Sandoval (R)
  16. New Jersey: Governor Chris Christie (R)
  17. New Mexico: Governor. Susana Martinez (R)
  18. New York: Governor Andrew Cuomo (D)
  19. North Dakota: Governor Jack Dalrymple (R)
  20. Ohio: Governor John Kasich (R)
  21. Oregon: Governor John Kitzhaber (D)
  22. Rhode Island: Governor Lincoln Chafee (I)
  23. Vermont: Health Care Access Commissioner Mark Larson
  24. Washington: Governor Jay Inslee (D)
  25. West Virginia: Governor Earl Ray Tomblin (D);and
  26. District of Columbia: D.C. Mayor Vincent Gray (D)

Four other states are currently giving serious consideration to expanding their Medicaid programs, including:

  1. Missouri
  2. New Hampshire
  3. Pennsylvania
  4. Utah

Despite the fact that the Obamacare has dedicated $10 billion to Medicaid innovation programs, many states are reluctant to adopt the nation’s health insurance program for low-income individuals and families. Some experts predict that most states will eventually expand the Medicaid programs but many others continue to disagree.

“I’d be really surprised if we see any more straight Medicaid expansions,” said Judith Solomon of the Center on Budget and Policy Priorities. “Every one of the remaining states wants to put its own stamp on it.”

In some Republican-led states, an alternative “private option” to Medicaid has been proposed. Rather than expanding Medicaid, these states would apply federal Medicaid dollars as a means to assist eligible persons in the purchase of private coverage via insurance exchanges.

To date, the federal government has approved “private option” strategies in the states of Arkansas and Iowa. Curiously, the federal government has simultaneously warned that it would be unlikely to grant permission to execute strategies of this type in every state.

Officials in Pennsylvania and Tennessee have also initiated conversations with the U.S. Department of Health and Human Services (HHS) about similarly structured versions of the private insurance option, and soon may receive approval to implement these plans.

Tennessee Governor Bill Haslam explains his position on the matter by stating that “We can no longer sustain the current reimbursement system, which simply rewards providers for doing more rather than for delivering the highest quality services in the most cost-effective manner.”

In two additional states, Democratic governors may also seek federal approval for private plans. In New Hampshire, Governor Maggie Hassan is expected to pursue the state’s own private option. And in Virginia, Democratic Governor Terry McAuliffe, at the insistence of Republican lawmakers, may also adopt an alternative plan.

Through 2014, states that decide to expand Medicaid programs will receive federal funding to cover 100 percent of the costs of new Medicaid enrollments. However, there is a significant catch. Although this funding level will remain in effect through 2016, the federal contribution will decline each following year until 2020. By then, the federal share will have dropped to 90 percent.

The Medicaid program is expected to cover 9 million more people in 2014 than the 72 million it insured in 2013.