Medicaid Expansion: Seven things the public should know about the evidence



In 2012, the Supreme Court affirmed the constitutionality of the Affordable Care Act but made Medicaid expansion optional for states. This resulted in a natural experiment in which 37 states (including the District of Columbia) expanded Medicaid and 14 have not, including Missouri. As Missouri considers Medicaid expansion, we have the unusual opportunity to learn from an extensive body of research on the differences between the states that have expanded and those that have not. These results consistently show that expansion benefits patients, health care institutions, and communities, and that it is fiscally prudent for states. The most recent comprehensive review of these studies by the Kaiser Family Foundation summarized the findings from 324 analyses. Building off the evidence, which continues to accumulate, more studies are pending, including those beyond the direct effects on health and health care. In this post I highlight important evidence in seven areas. Overall, these findings make a compelling case for expanding Medicaid in Missouri.

Here’s what you need to know about it:

  1. Expanded insurance coverage and access to care

Expansion results in more people having insurance coverage and access to care; this may appear obvious, but its importance should not be overlooked. The consequences are real – more patients seek care earlier, stay healthier, and health care spending is reduced. Fewer people will forgo needed doctor visits for cardiovascular disease and more people will have better glucose monitoring. With full implementation, Missouri’s expected enrollment would increase by more than 300,000, resulting in a significant increase in Missourians getting better coverage and access to care.

  1. Improved health and longer lives

Tracking the effects of coverage and access on people’s health over several years has produced recent findings that show expansion reduces mortality from cardiovascular diseases, end-stage renal disease, and cancer, as well as infant and maternal mortality. Not surprisingly, research on overall mortality shows declines as well, with estimates that the nation would have had 15,600 fewer deaths if all states had expanded Medicaid at the outset.

Findings regarding improved health are as noteworthy as those on longer lives. Medicaid expansion results in fewer people experiencing psychological distress and days of poor mental health. Health disparities are reduced among covered populations, which include children, young adults, veterans, mothers, people with HIV, racial and ethnic groups, and newly diagnosed cancer patients. Especially relevant for Missouri, rural residents disproportionately gain health benefits from expansion. In brief, our health care system would take a big step toward fairness with Medicaid expansion.

  1. Ameliorated the opioid epidemic

Expansion states have done a much better job of providing care for patients with opioid use disorder. The Affordable Care Act (ACA) made addiction treatment an essential benefit that must be provided under Medicaid expansion. Drugs approved for treating addiction or overdose are used more than three times as often in expansion states. Federal funds targeted to address the opioid epidemic are subject to re-authorization, therefore expanding Medicaid is the best long-term solution in order to make real progress on this issue, which has shown to be a huge health barrier in Missouri. While most states saw a decline in overdoses, Missouri’s rates increased last year.

  1. Increased family financial stability

The health problems of patients and families are almost always accompanied by financial stress and strains. In expansion states fewer patients incur medical debt or use payday loans. (In Missouri, over 20% of the population has medical debt in collections, more than the share of Missourians with student loan debt.) Missouri is ranked seventh in adults reporting past due medical debt and has one of the highest payday loan use rates. Expansion reduces the likelihood of having medical debt and borrowing money or skipping payments on other bills to pay for health care. Also, for employed enrollees Medicaid makes it easier to continue working, and for unemployed enrollees it makes it easier to look for a job.

The health of Missouri families is obviously the most important aspect of the Medicaid debate, but the state has a dual responsibility to protect our overall economy along with our health.

  1. Minimal impact on state budgets

In 2020 and going forward, the federal government pays for 90% of the costs of expansion. The impact of the other 10% on the state budget can be offset by several factors, including the lower costs of expansion enrollees and the reduction in state spending for the uninsured in other programs like behavioral health, substance abuse services, and care in the criminal justice system. In addition, states get the enhanced federal match of 90% for some people previously enrolled under other categories with lower match rates. Overall most expansion states have found little, or even positive, change in their state budget as a result of expansion. This is consistent with a recent analysis of the estimated impact of expansion on Missouri’s budget.

  1. Bolstered state economies

Studies in Iowa, Colorado, and Ohio have found benefits of expansion to include increases in jobs, average household incomes, state and local tax revenues, and state GDP. Ohio, Michigan, and Montana all found a stronger labor force, including a 9% job participation increase among low-income residents in Montana, better perceived job performance in Michigan, and more accessible job opportunities in Ohio. Overall, the infusion of federal funds into these states has had positive ripple effects throughout their economies, especially in under-resourced communities.

  1. Strengthened health care system

Expansion benefits the health care system in many ways, including reducing bad debt, reducing emergency room visits by “high utilizers” and patients without insurance as well as visits for asthma and diabetes (which are better managed at clinics or offices). In expansion states hospital revenues increased faster and uncompensated care decreased faster than in non-expansion states. Rural hospitals were less likely to close in expansion states, but closures happen for a number of reasons, in addition to Medicaid expansion. For clinics and offices that provide primary care and care for chronic conditions, expansion reduces the barriers to routine care and allows nurses, doctors, and pharmacists to more effectively manage their patients’ health problems.

Expanding Medicaid is not a panacea. It is only one component in making Medicaid the exemplary program that Missouri citizens deserve. Medicaid in Missouri also needs fundamental improvements in technology, policy, and staffing. This crucial linchpin in Missouri’s safety net infrastructure is primed for both a comprehensive upgrade and expansion, and they can be done simultaneously, without choosing one over the other.

Looking to the future, it is possible federal legislation could bring sweeping changes to the financing and organization of health care. Legal challenges to the ACA also raise uncertainty over the future legal and regulatory framework for our health care system. But one thing is certain – when we look at the accumulation of evidence on the effects of Medicaid expansion, the unavoidable conclusion is that expanding Medicaid is a prudent and effective investment in the future of Missouri’s health.

This is the first blog of a series on Medicaid expansion that the Foundation will be releasing over the next few months. We believe all Missourians should have affordable coverage, and it’s important that we all understand the real impact of Medicaid expansion and what it means for the people.