States that expand Medicaid could see $2.59 gained in Medicaid revenue for every private insurance dollar lost, according to a study by the Urban Institute funded by the Robert Wood Johnson Foundation.
Under the Patient Protection and Affordable Care Act, states have the option to raise the income eligibility mark for Medicaid to 138 percent of the federal poverty line starting in 2014 in exchange for full federal funding for the expansion for three years and not less than 90 percent of the added cost after that. The study examined current low-income patients who have private insurance but would be newly eligible for Medicaid coverage if the state expanded the program.
Private insurers tend to reimburse hospitals at higher levels than government plans like Medicaid, so patients that drop private plans to enroll in Medicaid would represent an estimated $113.6 billion loss in compensation for providers if every state adopted the broadened Medicaid criteria. But, the report found the sheer volume of new Medicaid revenue from newly eligible patients would be more than double the loss of private coverage abandoned in favor of Medicaid enrollment, raking in an added $293.9 billion from Medicaid by 2022 if every state agreed to the expansion, 22.8 percent more than what they'd have received without the PPACA provision, according to the study.
So far, 17 states have implied they would not expand Medicaid, which could challenge providers in those states further with $22 billion in cuts over 10 years to disproportionate share hospital payments.
The researchers said the PPACA would drop the national uninsured rate by 28 percent thanks to the individual and employer coverage mandates alone, without any states expanding Medicaid. But the uninsured rate would drop nearly in half if all states and the District of Columbia broadened Medicaid eligibility to the PPACA's desired levels.
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Under the Patient Protection and Affordable Care Act, states have the option to raise the income eligibility mark for Medicaid to 138 percent of the federal poverty line starting in 2014 in exchange for full federal funding for the expansion for three years and not less than 90 percent of the added cost after that. The study examined current low-income patients who have private insurance but would be newly eligible for Medicaid coverage if the state expanded the program.
Private insurers tend to reimburse hospitals at higher levels than government plans like Medicaid, so patients that drop private plans to enroll in Medicaid would represent an estimated $113.6 billion loss in compensation for providers if every state adopted the broadened Medicaid criteria. But, the report found the sheer volume of new Medicaid revenue from newly eligible patients would be more than double the loss of private coverage abandoned in favor of Medicaid enrollment, raking in an added $293.9 billion from Medicaid by 2022 if every state agreed to the expansion, 22.8 percent more than what they'd have received without the PPACA provision, according to the study.
So far, 17 states have implied they would not expand Medicaid, which could challenge providers in those states further with $22 billion in cuts over 10 years to disproportionate share hospital payments.
The researchers said the PPACA would drop the national uninsured rate by 28 percent thanks to the individual and employer coverage mandates alone, without any states expanding Medicaid. But the uninsured rate would drop nearly in half if all states and the District of Columbia broadened Medicaid eligibility to the PPACA's desired levels.
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