Medicaid Expansion Improving Health, Regardless of Format, Study Finds

August 9, 2016

Medicaid expansion programs in Arkansas and Kentucky were found to be equally effective at improving healthcare access for the target population. Both programs face revisions following the election of Republican governors, who want to add work requirements.

Medicaid expansion boosts access to primary care, curtails emergency department visits, and improves access to and affordability of medication, whether states pursue conventional expansion or a customized program like Arkansas’ “private option,” a new study has found.1

Reporting in JAMA Internal Medicine, researchers from the Harvard School of Public Health found that low-income adults from Kentucky and Arkansas fared far better after expansion in those states than their counterparts in Texas, the largest state that has not extended coverage to those earning between 100% and 138% of the federal poverty level.

“What this means is that it doesn’t matter so much how states expand coverage,” said lead author Benjamin Sommers, MD, PhD, who holds a joint appointment at the schools of Public Health and Medicine. “What matters is whether they expand at all.”

Crafters of the Affordable Care Act (ACA) did not envision such a divide, but the Supreme Court ruling that upheld the law said states could determine on their own whether to pursue expansion. In Kentucky, then-Governor Steve Beshear pursued expansion through an executive order, while Arkansas’ waiver was the result of talks with legislative Republicans, who wanted to reduce uninsured rates without expanding a government program.

The Arkansas plan permitted expansion enrollees to use federal dollars to buy private coverage, with the thought that this would reduce stigma, keep reimbursement rates higher, and promote greater access. An editorial accompanying the study says this worked as planned, and may, in fact, be a better choice for some states.

Frank J. Thompson, PhD, and Joel C. Cantor, ScD, both of Rutgers University, found that the Arkansas model reduces the “churning” and lapses in coverage that occur for those on the bubble of 138% FPL, who may fluctuate between Medicaid and private coverage. “Having a single program whereby the only thing that varies is the source of payment for coverage could prevent breaks in continuity of care,” they write.2

Sommers and his co-authors surveyed 9000 adults, ages 19-64 years with incomes below 138% of FPL, in all 3 states between late 2013 and the end of 2015. They found that uninsured rates for this group plummeted—from 42% to 14% in Arkansas and from 40% to 9% in Kentucky. In Texas, meanwhile, the uninsured rate for this group fell less dramatically, from 39% to 32%.

Screenings for diabetes, glucose testing among those found to have diabetes, and care for chronic conditions all increased after expansion. By 2015, expansion was associated with:

· A 12.1% improvement in access to primary care

· An 11.6% drop in skipping medication due to cost

· A 29.5% decline in out-of-pocket expenses

· A 6% drop in visits to the emergency department

The only significant difference between health outcomes in Kentucky and Arkansas was a higher rate of diabetes screening in Kentucky, the study found. Just prior to the ACA taking full effect in 2014, Kentucky had pursued an aggressive switch to Medicaid managed care that had some early problems, but was designed to boost screenings and preventive care.

Despite its apparent benefits, Thompson and Cantor note the Arkansas “private option” has come under some scrutiny from the Government Accountability Office, which found that enrolling the expansion population on the exchanges was 50% more expensive and thus not “budget neutral,” as required by federal law.

Since 2014, both Arkansas and Kentucky have elected Republican governors who have advocated changes to Medicaid expansion. Kentucky Governor Matt Bevin is expected to soon seek a waiver that would add requirements for enrollees to pay small premiums and work or volunteer. Under a draft proposal, dental and vision coverage would cease to be automatic benefits and would have to be earned through a system of credits.

In Arkansas, Governor Asa Hutchinson signed into law an updated version of expansion called “Arkansas Works,” which also has premiums, job training requirements, and, like Bevin’s plan, a requirement that employee-sponsored coverage be used if available. An April 5, 2016, letter from HHS Secretary Sylvia Mathews Burwell found 2 problematic elements: (1) an asset test for newly eligible enrollees who meet income limits would ask them to pay to access the program, and (2) cancellation of a 90-day retroactive eligibility provision that Burwell said is needed due to enrollment challenges in the state. The Arkansas Works waiver is pending.

References

1. Sommers BD, Blendon RJ, Orav EJ, Epstein AM. Changes in utilization and health among low-income adults after Medicaid expansion or expanded private insurance [published online August 8, 2016]. JAMA Intern Med. 2016; doi: 10.1001/jamainternmed.2016.4419.

2. Thompson FJ, Cantor JC. Scrutinizing alternative paths to Medicaid expansion [published online August 8, 2016] JAMA Intern Med. 2016; doi:10.1001/jamainternmed.2016.4422.