Low-Income Adults View Medicaid as Comparable to Private Insurance

The majority of low-income adults in 3 states favored Medicaid expansion, but knowledge about their states' plans for the program under the Affordable Care Act was low, according to a report from the Commonwealth Fund.

The majority of low-income adults in 3 states favored Medicaid expansion, but knowledge about their states’ plans for the program under the Affordable Care Act was low, according to a report from the Commonwealth Fund.

Researchers surveyed low-income individuals between 19 and 64 years of age in Kentucky, Arkansas, and Texas. These 3 states are taking very different approaches to the issue of Medicaid expansion. Kentucky has expanded eligibility for the program, Arkansas set up a system of using Medicaid dollars to purchase private health insurance, and Texas has rejected the expansion outright.

Overall, 27 states and the District of Columbia have elected to expand Medicaid under the health reform law. In addition to Arkansas, Iowa is also using federal funds to purchase private marketplace insurance for some of the state’s low-income population.

Despite the different approaches being taken, a third of respondents had heard or read that their state would expand Medicaid in 2014, according to the investigators. More than a third of respondents said they were in poor health and 52% to 71% reported having at least 1 of 9 chronic conditions.

“While critics say Medicaid does not produce meaningful gains in access to care or health, evidence shows that these critiques are false,” co-author Benjamin Sommers, assistant professor of health policy and economics at Harvard School of Public Health, wrote in a blog post on the Commonwealth Fund’s website. “Despite Medicaid's relatively low reimbursement rates compared with private insurance, observational studies and one randomized trial show that Medicaid expansions produce major gains in affordability, access to primary care, and receipt of recommended preventive services among low-income adults.”

Not only is support for Medicaid expansion strong among low-income adults (83% in Kentucky and Arkansas, 79% in Texas), but most respondents rated quality of care in Medicaid as similar to or better than private insurance plans. Although, private coverage was viewed as offering better access to and more respect from doctors, Medicaid is more affordable, according to respondents.

According to Sommers, it was unclear whether gaining coverage through traditional Medicaid or subsidized private insurance would be better for this population.

“Private insurance may provide better access to a broad range of providers and foster higher-quality care with its more generous reimbursement rates, as well as minimize so-called churning in coverage related to changes in income,” he wrote. “Alternatively, Medicaid providers and managed care plans may be better suited to care for this population, and may do so at a more affordable price.”