Medicaid Expansion

Medicaid Expansion

In an effort to extend health care coverage, the ACA will give states the option of expanding Medicaid eligibility. Details of the Medicaid expansion are as follows:

  • The expansion will allow for Medicaid coverage of all legal resident childless adults with an income at or below 133% of the federal poverty level, with a 5% income disregard. It is estimated that, as a result of the Medicaid expansion, up to 16 million additional individuals could become eligible for Medicaid, representing a 30% potential increase in the number of Medicaid enrollees.
  • For states that choose to participate, the expansion will begin on January 1, 2014, unless states choose to expand their Medicaid eligibility early. In the meantime, states will be required to maintain their current levels of coverage under so-called “maintenance of effort” (MOE) provisions.
  • For the newly eligible population, the ACA increases the rate of Federal Medical Assistance Percentages (FMAP) to states as follows: 

2014 through 2016

   100% federally funded (FMAP)

2017

95% federally funded

2018

94% federally funded

2019

93% federally funded

2020 onwards

90% federally funded


  • To receive full federal matching funds, states must expand Medicaid to 133% of the federal poverty level. States that wish to engage in only a partial expansion will not be eligible for enhanced FMAP rates.
  • For states that expanded their Medicaid programs prior to December 1, 2009, the federal government will provide an alternate increased FMAP to match expenditures for adults who would otherwise be considered newly eligible.
The Supreme Court has ruled that states are not required to expand Medicaid eligibility, and that the federal government is not permitted to withhold full Medicaid funding from states that choose not to participate in Medicaid expansion. To date, 27 states and the District of Columbia have indicated that they intend to participate in Medicaid expansion, 20 states have indicated that they do not intend to participate, and 3 states remain undecided.

Participating

Undecided

Not Participating

Arizona

Alabama

Indiana

Arkansas

Alaska

Pennsylvania

California

Georgia

Utah

Colorado

Idaho

Connecticut

Kansas

Delaware

Louisiana

District of Columbia

Mississippi

Florida

Missouri

Hawaii

Nebraska

Illinois

North Carolina

Iowa  Oklahoma
 

Kentucky 

South Carolina
 

Maryland

South Dakota

Massachusetts

Tennessee

Michigan

Texas

Minnesota

Virginia

Montana

Wisconsin

 

Nevada

Wyoming

 

New Hampshire


 

New Jersey


 

New Mexico


 

New York 
 
 

North Dakota

 

Ohio

 

 

Oregon 
   

Rhode Island

 

 

Vermont

 

 

Washington

 

 

West Virginia 
   

The Medicaid expansion will involve collaboration among federal agencies, including CMS and HHS, and state Medicaid agencies. To date, implementation of the ACA’s provisions on Medicaid expansion include the following:

  • Revised requirements for mechanized claims processing and information retrieval systems.
  • Guidance from CMS to the states about the impact of the Supreme Court decision on the implementation of Medicaid expansion and compliance with MOE requirements.
  • Federal funding to make major improvements to state Medicaid eligibility systems in preparation for the expansion.