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Medicaid Expansion Under ACA Found to Have More Positive Than Negative Effects

Allison Inserro
A new study published in Health Affairs hopes to provide an explanation of the evidence for the pros and cons of Medicaid expansion as part of the Affordable Care Act (ACA) with a systematic literature review, finding that expansion was associated with increases in coverage, service use, quality of care, and Medicaid spending.
A systematic literature review published in Health Affairs found that Medicaid expansion under the Affordable Care Act (ACA) was associated with increases in coverage, service use, quality of care, and Medicaid spending. Among those who benefitted the most are adults without a college degree, patients with cancer, and patients with diabetes.

The authors said they hope their work will be used to inform the discussion and debate over Medicaid expansion that has been happening for the past year and a half, as Republicans in Washington, DC, and in certain states have been trying to repeal or weaken the ACA as well as resist efforts to expand Medicaid. Medicaid provides healthcare to about 76 million people, or about 1 in 5 low-income Americans.

Efforts to repeal the ACA outright have failed and served only to increase the popularity of Medicaid. One of the proposed changes was to reverse the expansion of eligibility for Medicaid, partly by limiting federal funding to state Medicaid programs.

 The ACA allowed states to expand Medicaid eligibility to nonelderly adults with incomes up to 138% of the federal poverty level. Although the expansion was originally intended to be enacted nationwide, in 2012 the Supreme Court of the United States ruled that states could opt out of it. As of July 2017, 32 states and the District of Columbia had opted to expand Medicaid eligibility, the authors noted.

After an initial search, the researchers from Indiana University narrowed their list of studies to review to 77—of those, 81% used quasi-experimental designs, and 65% included data for just 1 year after the Medicaid expansion.

The 77 studies contained 440 unique analyses, of which 61% reported a significant effect of Medicaid expansion consistent with the goals of the ACA. Thirty-five percent reported no significant effect, and 4% reported an effect inconsistent with the ACA goals. However, study designs with weaker internal validity were significantly more likely to report an effect inconsistent with the ACA (14.5% versus 2.6%;  P <.001).

Very few studies reported that Medicaid expansion was associated with negative consequences, such as increased wait times for appointments—and those studies tended to use study designs not suited for determining cause and effect.

Overall, there were more positive changes brought about by Medicaid expansion than negative, the researchers reported. The minority of studies that did find negative effects “tended to use methodologies with limited ability to determine cause and effect,” they wrote.

Studies using designs with stronger internal validity, such as experimental or quasi-experimental studies, did not differ from other studies with respect to the likelihood of reporting a relationship consistent with the ACA (60.6% versus 62.9%; P = 0.89)

Of the 62 studies that used quasi-experimental designs, 4 outcomes were among the most frequently studied: access to care' health and quality of care; cost of care; and hospital financial performance.

Access to care

Expansion was associated with increased insurance coverage among all potentially eligible individuals, including major racial/ethnic groups, age groups, income, and by marital status. In addition, coverage gains were largest for adults without a college degree, and expansion led to a decrease in short- and long-term uninsurance rates in the general population and for patients with cancer.

Health and quality of care

No study reported a decrease in health or quality of care following expansion. Expansion was associated with improved glucose monitoring rates for patients with diabetes, better hypertension control, improved rates of prostate cancer screening, and higher rates of Pap testing.

There were also reductions in self-reported rates of psychological distress and days of poor mental health, as well as increased self-assessed general health. Another finding was significant positive effects on severity of illness, indicating that patients with greater need for inpatient services were more likely to gain health coverage than not.

Cost of care

Three-fourths of these analyses found increases in Medicaid expenditures, mainly from reported increases in prescription drug reimbursements by Medicaid and in Medicaid spending, which mostly came from increased federal spending.

Hospital financial performance

Medicaid expansion was associated with improved hospital financial performance, including a reduction in uncompensated care and increased excess margins and Medicaid revenues, in the 6 studies containing 25 analyses that focused on this measure.

However, 2 related analyses from the same study reported an increase in nonprofit hospitals’ bad debts, while for-profit hospitals saw a decrease in charity care expenses—despite the fact that for-profit hospitals were not the intended beneficiaries of this particular Medicaid expansion.

Reference

Mazurenko O, Balio CP, Agarwal R, Carroll AE, Menachemi N. The effects of Medicaid expansion under the ACA: a systematic review. Health Aff (Millwood). 2018;37(6):944-950. doi: 10.1377/hlthaff.2017.1491

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