According to an article released today in Health Affairs, adults with incomes between 100 and 138 percent of the federal poverty level (FPL)—i.e., “near-poor” adults—saw lower out-of-pocket (OOP) costs and a reduced likelihood of being uninsured in states that expanded Medicaid than in non-expansion states.
Overview: Access to Medicaid among Near-Poor Adults
The analysis, which is based on a SHARE-funded study led by Dr. Fred Blavin (Urban Institute), used 2010 to 2015 data from the Current Population Survey (CPS) and the American Community Survey (ACS) along with state Medicaid expansion decisions as a natural experiment to estimate the impact of access to Medicaid on OOP health expenses and health insurance coverage, compared with access to subsidized Marketplace coverage. In states that chose not to expand Medicaid, near-poor adults may qualify for tax credits to purchase Marketplace plans that involve OOP premiums and cost-sharing; in expansion states, this population would generally face no premiums and minimal cost-sharing if they enrolled in Medicaid instead.
Key Findings: Out-of-Pocket Spending
Using OOP spending information from the CPS, Dr. Blavin and his co-authors found that Medicaid expansion, relative to Marketplace access, was associated with a $344 (33.9%) reduction in average total OOP spending, a $125 (23.0%) reduction in average OOP premium spending, and a $218 (46.4%) reduction in average OOP cost-sharing spending from 2010-2013 (before Medicaid expansion) to 2014-2015 (after Medicaid expansion). These decreases in average OOP spending were primarily driven by declines in the probability of having any OOP spending.
The $344 reduction in average total OOP spending from Medicaid expansion corresponds to 2 percent of annual income for adults in the 100 to 138 percent FPL range, and this is consistent with the amount that near-poor individuals would have to pay out-of-pocket for a Marketplace plan in a states that chose not to expand Medicaid. The authors note, however, that the impact of expansion for those who newly enrolled in Medicaid is likely to be higher, especially for those who had high OOP expenses prior to the ACA—e.g., high-cost uninsured adults and those with expensive employer plans.
| Related Resource: Webinar Recording and Slides | |
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Dr. Blavin presented findings from this analysis during a SHARE webinar on December 5, 2017. The recording and transcript of this event, along with the presentation slides, are now available online. |
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| Click here to access these materials. |
Key Findings: Coverage
Using coverage information from the ACS, the authors found that Medicaid expansion reduced the probability of being uninsured among near-poor adults by 4.5 percentage points between 2010-2013 and 2014-2015, compared to non-expansion states. This impact was driven by significant increases in Medicaid coverage that were partially offset by declines in ESI and direct purchase coverage.
According to the authors, these findings imply that more restrictive eligibility and enrollment policies, combined with higher premiums for Marketplace coverage relative to Medicaid, were associated with lower take-up rates among near-poor adults.
Read the full Health Affairs article.