The Medicaid expansion haves … and mostly have nots … in the South

Which region of the country has the fewest states that opted to expand Medicaid, the highest rate of uninsured nonelderly adults, leads the nation in chronic conditions such as obesity and diabetes, and finds the majority of its states have poverty levels above the national average? No surprises here … it’s the South.

Jessica Stephens, a senior policy analyst with the Kaiser Family Foundation’s Commission on Medicaid and the Uninsured, has been instrumental in working on several KFF projects this year assessing coverage and care in Southern states, along with opportunities and challenges the region faces to provide increased healthcare access and equity. Stephens, who received both her undergraduate degree and master’s in Health Policy and Administration from Yale, is also part of the Disparities Policy Project for KFF.

In looking at expansion decisions by region, Stephens noted KFF uses the U.S. Census Bureau definition of the South, which includes 16 states – stretching westward to Texas and northward to Delaware – plus the District of Columbia.

“Six states including D.C. have implemented the Medicaid expansion,” Stephens said, listing Delaware, Maryland, the District of Columbia, Arkansas, Kentucky and West Virginia. “They’ve all taken slightly different approaches,” she noted. “Arkansas, in particular, has adopted a private option where they are using Medicaid funds to assist newly eligible adults pay for private coverage through the marketplace,” Stephens added of a waiver granted by the Centers for Medicare & Medicaid Services to allow the state to provide premium assistance.

Nationally, Stephens continued, 26 states plus the District of Columbia have implemented Medicaid expansion, which means nearly half of the U.S. states electing not to expand at this time are located in the South – 11 of the remaining 24. “In the West and Northeast, the majority of states have (expanded). In the Midwest, a larger number are not, but it’s still more than in the South.”

The reasons for not implementing expansion are multifactorial. Stephens said that in addition to general political opposition to the Affordable Care Act in many Southern states, there is also a concern over the sustainability of maintaining expanded Medicaid rolls even though the phased down match rate of 90 percent is still much higher than the general Medicaid population. And, she continued, “There are concerns over the Medicaid program overall … how it’s run in general.”

On the flip side, though, there is mounting concern over what the decision to not expand means for a large number of people. Stephens said more than a third of the nation’s population, 37 percent, live in the South, and the region is also home to 4 of 10 people of color. “The expansion was important, in part, because it was going to expand Medicaid to adults who were historically excluded from the program,” she said.

A very large percent of those who make too much for traditional Medicaid but not enough to qualify for federal subsidies reside in the South. “Overall in the South, there are 3.8 million people who fall into this gap, and nationally, there are 4.8 million … so nearly 80 percent of all those who fall into the gap nationally are in the South,” Stephens stated.

She added people are often surprised to find out just how little a family could make in order to qualify for traditional Medicaid. Citing median levels, she noted, “For a family of three – one adult and two children – that family cannot earn more than approximately $12,000 a year for the parent to be eligible.” Stephens continued, “Non-disabled, childless adults remain ineligible regardless of how much they earn.” Without expansion, she said, Medicaid eligibility for adults remains very limited.

Additionally, Stephens noted the decision not to expand Medicaid also further exacerbates healthcare disparities with people of color being disproportionately impacted by the choice. “Six in 10 blacks who would have been eligible for Medicaid in the South, about 1.2 million people, are not because they fall into the coverage gap.”

Among states that did expand coverage, Stephens said reports are coming in that those states have been able to improve the efficiency and function of their Medicaid programs by taking advantage of a number of ACA provisions. “We can tell the Affordable Care Act and the Medicaid expansion has important potential to change delivery,” she said. “It also has the potential to reduce disparities in access to coverage and care by race and ethnicity and also by geography if the Southern states would expand.”

Even without expansion, though, Stephens said outreach and consumer assistance is critically important to chip away at the 21 million in the region still lacking any type of coverage. About 48 percent of the South’s uninsured currently qualify for existing programs.

“Of the 21 million uninsured in the South, we have 7 percent who are Medicaid-eligible adults, 11 percent who are Medicaid- or CHIP-eligible children, 30 percent who are eligible to obtain tax credits to purchase private coverage through the marketplace, 18 percent who are in the coverage gap, 21 percent who are ineligible for financial assistance who have incomes above the tax credit limit or an offer of employer-sponsored coverage, and 13 percent who are ineligible due to their immigration status,” Stephens outlined.

Ultimately, improving health outcomes will largely depend on the creation of dependable channels to access care … whether through the expansion of Medicaid, implementation of other solutions to address the needs of the uninsured, or a combination of both.

RELATED LINKS:

Healthcare Coverage & Care in the South: A Chartbook

Healthcare Coverage & Care in the South in 2014 and Beyond

Key Themes from a Roundtable Discussion on Healthcare & Equity in the South