Q&A: What is Medicaid expansion, really?
The inner workings of Medicaid, a federal program intended to provide health coverage to low-income Americans, are wonky and incredibly difficult to understand.
You’ve probably heard the term “Medicaid expansion,” words that have become weaponized by opportunistic politicians, used as a smoke screen to avoid talking earnestly about an extension of the existing federal program that provides even more people with basic health care coverage.
As Mississippi’s health care crisis continues, we’ve compiled answers to some frequently asked questions to show the direct effects of the policy, how it could change lives across the state, and what the state could stand to gain by passing it.
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What is Medicaid?
Medicaid is a federal program that provides health coverage to millions of people in the U.S., including low-income adults, children, pregnant women, elderly adults and people with disabilities. States administer the program, which is funded by both states and the federal government. Mississippi currently participates in the traditional Medicaid program.
What is Medicaid expansion?
Medicaid expansion is a special provision created under President Barack Obama’s 2010 Affordable Care Act that aims to allow more low-income Americans to be covered by the program and decrease the number of uninsured people. Mississippi is one of 12 states that has not opted into the expansion program. In states that have chosen to expand, Medicaid eligibility is extended to adults up to age 64 who have incomes up to 138% of the federal poverty level – or about $25,000 for a family of two.
Currently in Mississippi, non-disabled adults without children generally never qualify for the program, and the income requirements are very stringent for those who are parents ($4,608 in annual earnings for a family of three).
How many additional people would be insured if Mississippi expanded Medicaid?
Studies have estimated Medicaid expansion in Mississippi would cover over 200,000 additional people. Other states that have expanded have seen a decline in uninsured people – a desired outcome in Mississippi, which ranks 6th in the nation for the percentage of uninsured people.
What would the economic impact of Medicaid expansion be?
Estimates show Medicaid expansion would bring in more than $1 billion in new revenue each year. Multiple studies have shown Medicaid expansion would save the state money by reducing uncompensated care costs for hospitals, reducing chronic illness through preventive care, and that it would help the economy by creating thousands of jobs and the “multiplier effect” of the federal dollars. Studies by state economists have shown it would, over time, increase the state’s GDP and population.
What are the mechanisms that could be used in Mississippi to expand Medicaid?
Expansion of Medicaid in Mississippi would require action by the state Legislature, and approval by the governor.
Who is in favor of Medicaid expansion and why?
Many leaders and physicians in the medical community favor Medicaid expansion because of the financial benefits their institutions would reap. Health care organizations like the Mississippi State Medical Association, Mississippi Hospital Association, American Cancer Society, American Heart Association, and countless others support expansion. And top business leaders and organizations like the Delta Council have publicly supported Medicaid expansion because of the broader economic benefits it would create.
Democrats in the Legislature, who wield little power and influence over major policymaking decisions, and scores of other Democratic elected officials have publicly supported Medicaid expansion for years. Republican Lt. Gov. Delbert Hosemann, the leader of the state Senate, has repeatedly highlighted the need for health care for working people, though he stops short of advocating for Medicaid expansion. Several other legislative Republicans and even Republican statewide candidates in recent elections have publicly supported expansion, but none have succeeded in starting earnest debate in the Legislature.
Who opposes Medicaid expansion and why?
Top Republican leaders in the state, led by Gov. Tate Reeves and Speaker of the House Philip Gunn, have long rejected Medicaid expansion. Many of the arguments against expansion have been overtly political and partisan — opposition against expanding “Obamacare,” which many Republicans opposed from the start. Others are more philosophical arguments against increasing any large government program or that health care should be done through the private sector. But two of the main arguments from Mississippi elected leaders against it have been that the state budget cannot afford it and that the federal government will one day stop paying the largest share and leave state taxpayers holding the bag.
What has happened in other states that have expanded Medicaid?
Other states that have expanded Medicaid have seen a large drop in uncompensated care costs – the costs that hospitals must cover themselves to care for uninsured patients. Louisiana, our neighbor that expanded Medicaid in 2016, saw a 55% decrease in uncompensated care costs for rural hospitals after expanding — and a substantial drop in mortality rates.
Why do states have the choice of whether to participate in Medicaid expansion?
The U.S. Supreme Court in 2012 issued a decision in a case that challenged the constitutionality of the Affordable Care Act, the sweeping health care reform law enacted in 2010 that aimed to make health insurance more affordable. One major tenet of the law was to expand Medicaid to cover more people. The high court upheld the law in general, but said that the federal government could not mandate that states expand Medicaid. Based on that portion of the ruling, 12 states, including Mississippi, have not expanded Medicaid. In Mississippi, the few times the issue of Medicaid expansion has been before either full chamber of the Legislature is when Democratic members have offered amendments to other Medicaid-related bills. The Republican majorities have regularly voted down those amendments.
How much do Mississippi hospitals pay to care for people who don’t have insurance or Medicaid?
The cost of uninsured care for calendar year 2021 is estimated to be $482 million. The cost of total uncompensated care (uninsured plus others who don’t pay the full balance) is $594 million. Hospitals must cover these costs themselves, often leading to budget woes that can close a hospital for good or require drastic cuts in health services offered. The effects of this uncompensated care have only worsened as the COVID-19 pandemic and the accompanying high labor costs have financially strained hospitals. Medicaid expansion would flow millions per year directly to hospitals to help them cover these costs.
Is our current Medicaid program free? Who qualifies for it?
Medicaid is free for beneficiaries and funded by the federal and state governments. Currently in Mississippi, several categories of people qualify for Medicaid:
- Infants and children who live in low-income families
- Uninsured children whose family income does not exceed 209% of the federal poverty level will qualify for Children’s Health Insurance Program
- Parents and caretakers of minor children who live in the home. The parents must be without the support of one or both parents due to disability, death, or continued absence or who are unemployed or have very low income. To qualify, the parent or caretaker must cooperate with child support enforcement requirements for each child whose parent is absent from the home.
- Pregnant women with income under 194% of the federal poverty level. These women will receive benefits for two months postpartum and are then put on the family planning waiver.
- Pregnant women under 19 years old automatically qualify for pregnancy Medicaid.
- Disabled children who require a level of care typically provided in a hospital or long term care facility but are living at home.
- Working disabled: Adults whose income is below a certain level and who work at least 40 hours per month.
- Aged, blind or disabled people who received Supplemental Security Income (SSI), those who formerly received SSI, and those residing in a nursing facility or participating in a Home and Community Based Services Waiver Program.
How much does it cost the state and taxpayers to provide our current Medicaid program?
Medicaid expenditures are based on usage. The more Medicaid beneficiaries see health care providers for treatments, the greater the cost. For the current fiscal year, the Legislature has appropriated $902 million in state funds for the Division of Medicaid and expects to receive $5.79 billion in federal funds. Mississippi, as the nation’s poorest state, receives the best matching rate with the federal government currently paying 84.5% of the health care costs. The state pays the rest. If not for the COVID-19 emergency that is slated to remain into effect until early in 2023, the federal government would be providing Mississippi a 77.86% matching rate. But currently, the federal government pays 90% of the health care costs for those covered through Medicaid expansion. In addition, the federal government would provide non-expansion states a two-year incentive to opt into Medicaid expansion. For Mississippi that would result in more than $600 million in federal funds over two years.
What services are covered under the current Medicaid program?
Full Medicaid benefits cover office visits, family planning services, inpatient and outpatient hospital care, prescription drugs, eyeglasses, long term care services and inpatient psychiatric services. Medicaid will also provide transportation to eligible beneficiaries if they do not have other means of getting to medical appointments.
What are the differences between traditional Medicaid and expanded Medicaid?
The difference is more people are eligible under expanded Medicaid. Expansion would mean people earning up to 138% of the federal poverty level — or $25,000 for a family of two — would qualify for benefits. This would mostly include low-income, able-bodied parents; low-income adults without children; and many low-income individuals with chronic mental illness or disabilities who struggle to maintain well-paying jobs but do not currently meet disability requirements for Medicaid.
What is postpartum Medicaid and what is the debate about extending it?
Federal law requires states to provide pregnancy-related Medicaid coverage through 60 days postpartum, but many women, particularly in Mississippi and other non-expansion states, lose coverage at that point aside from basic family planning services and birth control. Health professionals and advocates have argued Mississippi needs to extend that coverage to a year postpartum like 34 other states have done. They say this will provide much-needed improvements in health outcome for mothers and babies in the state, where 60% of births are covered by Medicaid.
Despite bipartisan support for extending coverage for the tens of thousands of moms covered by Medicaid in Mississippi in the Senate, Speaker of the House Philip Gunn killed the bill in the 2022 legislative session and remains opposed. He cites his opposition to Medicaid expansion, but the legislation would not have expanded Medicaid eligibility – it would’ve extended coverage for people who already qualify.
Mississippi and Wyoming are now the only two states with neither extended postpartum coverage nor Medicaid expansion.
What is CHIP and how is it different from Medicaid?
CHIP stands for the Children’s Health Insurance Program and provides health coverage for uninsured children up to 19 years old and whose family income does not exceed 209% of the federal poverty level.
The coverage, unlike Medicaid for adults, includes dental care as well as medical services.
The state recently added mental health coverage as a mandatory benefit – including services necessary to prevent, diagnose and treat a broad range of mental health symptoms and disorders.
What is the history of Medicaid?
The U.S. Congress, at the behest of President Lyndon Johnson, approved Medicaid in 1965 to offer a safety net health coverage for poor Americans. Under the landmark legislation, the federal government and the states would share in paying the costs of the program. Mississippi was one of the last states to opt into the traditional Medicaid program during a 1969 special session. Mississippi Gov. John Bell Williams, who called the special session, voted against the Medicaid program as a member of Congress. As governor, Williams said it would benefit Mississippi to opt into the Medicaid program.
How many people in Mississippi are on Medicaid now?
As of July 2021, about 797,000 Mississippians were enrolled in either full-benefit Medicaid coverage or the Children’s Health Insurance Program.