Policy Brief: Medicaid Expansion

Assume you are working in the Governor's office of ‘your' state. You have now been asked to prepare a briefing document for the Governor on the optional Medicaid expansion under the Affordable Care Act. Your state may have already announced whether or not it plans to expand Medicaid to all individuals up to 138% FPL, or it may still be undecided.

• If your state has already announced a decision, write a brief to your Governor expressing whether you support the decision or if you recommend reconsidering the expansion.

• If your state is still undecided, write a brief to your Governor recommending either expanding or not expanding Medicaid.

When making your recommendation, keep in mind that newly eligible Medicaid enrollees will be financed by the federal government with a 100% FMAP in 2014, tapering to a 90% FMAP in 2020. Individuals who were previously eligible for Medicaid but not enrolled in the program will not be eligible for this enhanced FMAP but spending on them will be matched at the states' FMAP under the matching grant formula.

Write a policy brief that:

Explains the choice regarding Medicaid expansion that your state faces following the passage of the ACA and the Supreme Court decision

Discusses whether your state should or should not expand Medicaid.

1. In your assessment, consider whether your state has previously had waivers to expand eligibility for Medicaid and note to the governor what this means for the federal/state sharing of costs in the first few years of ACA. You may want to indicate that this residents of the state have generally favored a larger Medicaid program and

2. As you make the case, consider and discuss the dollar value of projected costs and savings to the state as well as reductions in the number of uninsured in your state. You can note how these estimates compare to historic values in your state and how they compare to other states in your region or, across the nation. In particular, pay attention to your state's costs of previously eligible but newly enrolled and savings from previous state safety net funding for uncompensated care.

• How would expansion affect the number of uninsured individuals in your state? How would expansion affect ‘net' state spending on Medicaid and other safety net programs? How would expansion affect levels of federal grants-in-aid to your state and on the need for new state revenues?

3. As you make the case for expanding or not expanding you could also note the implications of expanding for:

1) the health of the state's population;

2) the impact on hospital and other providers; and

3) the idea that residents of states that are not expanding will be paying increased federal taxes to support the spending in states that are expanding under the 100% FMAP; and

4) politics within the state now and as the state moves to the mid-term elections.

Note 1: Be sure to use data from your spreadsheet in your writing and note that there are several assigned readings that could be helpful to you. It may be useful to consider statements released by your state's Governor or legislators on the topic, if available.

Note 2: This exercise uses estimated values and makes many assumptions. Your results, while useful for informing a policy brief, are not necessarily accurate estimates of state costs and savings due to Medicaid expansion. For example, some states that had previously expanded their Medicaid eligibility will receive enhanced FMAPs to account for their prior program generosity. These FMAPs have yet to be determined by HHS, and therefore are not included in this analysis.