Expansion of Medicaid and the ACA


The ObamaCare Medicaid expansion is one of the largest achievements in health care reform. The Medicaid was instituted to cover nearly half of the uninsured American. The ACA Act previously required the State to expand the medical cover to all citizens earning less the 138 percent of the Federal Poverty Level (FPL) or lose the federal funding for the program (Williams & Council of State Governments, 2012).

However, after the supreme ruling on the Affordable Care Act leaves the decision to expand Medicaid coverage to individuals with income of less than 138 percent to an individual’s States. In accordance to Congressional Budget Office (CBO), Medicaid was predictable to account for approximately half of the new coverage of the uninsured (Ulmer et al., 2012). Since the Supreme Court ruling in the case of National Federation of Independent Business v. Sibelius, the ruling converted the mandatory requirement into a State option. Debates about whether to expand the Medicaid under the provisions of ACA have been influenced by the financial implications, especially regarding the potential States expenditure and compensation linked with the expansion of the program (Price et al., 2013). The central questions surrounding the ACA Act is the stakeholder’s impact on expansion and non-expansion of the Medicaid in different States.

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Literature Review

Affordable Care Act Effect on Medicaid

The expansion of the Medicaid program is estimated to increase the State Medicaid cost significantly by approximately 12 percent. The rise in cost result from expanded eligibility that is consistent with the published studies (United States & United States, 2012). Before the enactment of the ACA act, only few States provided cover to non-disabled and non-pregnant parent or even adult without dependable children. State decision on whether to implement the expansion of Medicaid under the ACA Act will affect approximately 15.1 million uninsured adult with income level below 138 percent (Ulmer et al., 2013). This category will now become eligible for medical insurance under the Medicaid expansion program. However, out of 15.1 million, 10.9 million have income levels that are below 100 percent of the FPL (United States & United States, 2012).

Under the ACA Act, the numbers of individuals that will be eligible include a mix of young and old people. In estimation, 26 percent are aged between 19 to 24 years and between 24 and 35 years, while 35 percent are within between 35 to 54 years. Lastly 13 percent are within 54 to 64 years. 7.8 million people who are newly eligible for the cover are aged below 35 years (Price et al., 2013). In overall, 47 percent of the people without the insurance who will qualify are women. Besides, 4.6 million of the uncovered are within the age of 19 and 44 years, considered to be reproductive age.

In States that implement the provisions of ACA, more persons with disabilities will qualify for the Medicaid mainly because of their low-income status that permits them to seek coverage without disability determination (Ulmer et al., 2013). The ACA has expanded Medicaid eligibility up to $16, 104 for an individual. For instance, in Washington State, the Medicaid commonly referred to as Washington Apple Health anticipates that more than 325,000 new clients will enroll after the expansion of the program (United States & United States, 2012).

Approximately 250,000 individuals between the age of 19 and 65 years who were previously ineligible will become eligible. Besides, 800, 000 pregnant women, children and families will be transferred to current Medicaid from other programs.

The full implementation of Medicaid in all States under the ACA is expected to raise the Medicaid fund to about half of the total coverage anticipated under the new law. Furthermore, CBO approximates that expansion of the program will only add insignificant expenditures to what the State would have used to implement health reforms, which will offer insurance cover to 17 million more low-income adults and children (De et al., 2013). The additional cost is approximated to be 2.8 percent of the States projected cost between year 2014 and 2022 in the absence of health reforms. However, such figures could largely be overstated because CBO calculation does not factor in the savings that local and State government received in their healthcare setting from uninsured persons (Angelotti, 2013). It is also anticipated that irrespective of whether the State accept the expansion program, the federal government will stop reimbursing health care setting for disproportionate share hospital (DHS) and the States for higher cost of uncompensated care when poor uses hospital services. The loss of such finances from the national government acts as an incentive to oblige the States to expand the Medicaid program.

Expansion of Medicaid: Washington

The policy makers in Washington State have expressed great interest on expansion of the Medicaid program in accordance to the provision of the ACA Act. The interest is centered on how large number of people will benefit from the new insurance cover under the Affordable Care Act and the cost of the implementation on the State budget (United States & Washington State Library, 2013). In 2013, Washington Governor Jay Inslee gave assent a $ 33.2 billion finances that will facilitate implementation of the ACA Act in the State (Angelotti, 2013). The requesting process for the qualified individuals has been simplified and can be done online. The streamlined exchange application processes expedite the process, and the eligibility determination only takes 45 minutes. This is because the State will use data integrated data from different government sources such as social security, IRS, homeland security to verify citizenship, income level and criminal history (United States & Washington State Library, 2013).

Though the federal administration will finance 100 percent of the medical expense up to 2016, the funding will reduce to 90 percent by 2019.

In Washington State, the numbers of people who qualify for the program and are aged below 65 years are approximately 1million (De et al., 2013). It approximated that more than half of the new enrollees are already qualified for the program but are not enrolled under their current situations. Furthermore, more than 495,000 individuals will qualify under the reforms (De et al., 2013). Furthermore, it has been noted that enrolling a qualified individual is more costly for the State than a newly qualified person one since the national matching rates are more for the newly qualified. However, prior to 2011, the State covered such residents using the State-run Basic Health Plan that was funded by the State (Meyer et al., 2012). Expansion of the Medicaid remains the best alternative in regard to the previous situation.

Medicaid expansion in Washington will affect the utilization of the healthcare system. It is anticipated that more enrollees under the ACA will create demand for more hospital care, particularly for previously uninsured individuals (Tate, 2013). Therefore, hospital days will predictably increase since high take up of the insurance is expected. The total increase in the number of non-elderly enrollees is expected to reach 209,000 days of high take-up from low of 112, 000. In short run, the Medicaid will cost an average of $5,800 per individual yearly (Meyer et al., 2012). The Washington State expects the new enrollee to increase total annual Medicaid cost by approximately $1.9 billion.
Non-Expanding State: North Carolina

In February 2013, North Carolina Governor issued a statement on the implementation of the Affordable Care Act (ACA). The governor noted that the State’s stakeholder have reviewed the advantages and disadvantages of the expanding Medicaid in North Carolina and decided not to expand (Silberman et al., 2013). The appraisal entailed the valuation of the prevailing systems, potential new administrative cost and operations flexibility related to the reform. Instead of expanding the Medicaid program, the State opted to utilize federal exchange. The State decision to prevent insurance cover funded by the federal government poses a significant impact to the uninsured. In North Carolina, American Indians, Latinos and African American reports higher rates of uninsured than white people (Silberman et al., 2013). Such reports translate to worse health outcomes for the people of color in the State. In short, expansion of the program will essentially provide medical cover to hundreds of thousands of North Carolina.

Rejecting the expansion for the thousands of hard-working and tax-paying families will relegates thousands of needy families to unnecessary suffering simply because of absence of appropriate preventive care (Tate, 2013). Expanding the Medicaid in North Carolina would have permitted low-income workers to access preventive care, and also bring more than $15 billion the States and create more than 20,000 jobs. According to the law, the government will fund the expansion program for the first 3 years, and the percentage will fall in the subsequent years until 2020 (Angelotti, 2013). Furthermore, it is apparent that every year of delay in implementation of the expansion program will imply surrendering billion of fund to bolster the economies of other States. It is expected that expansion of Medicaid will bring more than $15 billion in the North Carolina State. Money flow to the health care services provider and local becomes will boost the spending and employment rates.


In conclusion, it is apparent that the implementation of the ACA law will provide a great relieve to millions of uninsured Americans.

Although debates whether to expand the program has largely revolved around budgetary issues and financial implication within the States, it is established that the program will lead to insignificant increase in cost, but consequently will increase the number of insured persons.

Uninsured American poses a significant burden to the national economy. Therefore, implementation of the program will not only improve the lives of thousands of struggling North Carolinians, but it will save both the taxpayers and the State large amount of money.