Government-sponsored healthcare programs can be confusing. Regulations change all the time. Different states have different policies and programs based on individual needs, constituent voices and the wills of governing officials. At DECO Recovery Management, we want you to stay educated on the changes in Medicaid and how they affect patients’ eligibility for government-sponsored healthcare.
How Medicaid Has Expanded
In 2012, the Supreme Court upheld the Affordable Care Act (ACA; commonly known as Obamacare), but gave states the choice of whether to opt out of Medicaid expansion or adopt it. Therefore, due to the way Medicaid currently functions, the federal government sets up the rules and regulations for Medicaid expansion, but is up to individual states to decide what to expand and how to expand it. Many states have chosen to adopt the federal government’s changes in recent years, but others have not. The process has been slow to move, especially as administrations and lawmakers of both federal and state governments have switched in and out of their seats. More recently, the Trump Administration has been supportive of Medicaid expansion, urging individual states to experiment with it as needed. How the entire process will change as a result of future elections remains to be seen.
Under the ACA, current Medicaid expansion means that Americans with income levels up to 138% of the federal poverty level can qualify for government-sponsored healthcare. More specifically, that means a family of three making roughly $26,000 or less in a year or an individual making roughly $15,000 or less in a year is eligible to receive government assistance in paying for their healthcare bills. This expansion covers a wide range of previously uninsured individuals. This range includes low-income but able-bodied families, individuals with mental and physical disabilities who have trouble holding jobs due to their limitations and about half of uninsured veterans and Native Americans. Medicaid currently insures 50 million of the 90 million Americans, including children, who would be otherwise uninsured. But that still leaves 40 million Americans who currently go without coverage and fall through the cracks in the system. Perhaps as time goes on, this number will decrease as more states expand their Medicaid offerings. It will be valuable to keep track of this information over time, and we will continue to bring you updates as decisions are made and programs progress.
The number of states expanding Medicaid is steadily increasing, however. As of early 2019, Virginia has expanded Medicaid coverage. In November 2018, Idaho, Nebraska and Utah did the same. In Kansas and Wisconsin, officials are warming to the idea of Medicaid expansion. Several more states are in the process of approving it, which means that by the end of the year, up to 300,000 more uninsured Americans could have access to healthcare.
However, as of now, there are still several states that have not expanded Medicaid coverage, and may not for the foreseeable future. These states are: North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi, Tennessee, Texas, Oklahoma, Kansas, Missouri, South Dakota and Wyoming.
Even if your state hasn’t expanded Medicaid, though, patients should still apply for coverage through the healthcare marketplace. Different states have their own healthcare assistance programs that can help patients, even if Medicaid does not cover them.
In terms of compensation and reimbursement, the federal government currently pays for 93 percent of Medicaid costs, leaving 7 percent of costs that individual states have to pay. In 2020, that percentage is expected to change to 90 percent and 10 percent, respectively. However, this is still quite a difference from the 25-50 percent of costs that states without Medicaid expansion have to compensate using their own tax dollars.
The Results of Medicaid Expansion for States
States could actually save money by expanding Medicaid, in part by moving patients currently relying on state programs into Medicaid programs. Also, federal dollars being collected nationwide that aren’t being used on states without Medicaid expansion are going to states that have expanded their Medicaid offerings. This results in about $305 billion of federal funds that states without Medicaid expansion will miss out on between 2013 and 2022. About half of that number of tax dollars ($152 billion) will have been collected in the same time period from states without Medicaid expansion and given to states that have expanded Medicaid—with none of those funds coming back to the non-participating states.
With all of this and the amount of money that the federal government contributes to Medicaid considered, it is actually to states’ (and therefore hospitals’) advantage to expand Medicaid, as it will free up more funds in state budgets for other programs. This is why even some lawmakers who are traditionally against government-sponsored healthcare are for Medicaid expansion: it will benefit the state budgets more than it will hurt them.
What Medicaid Expansion Means for Hospitals and Health Care Providers
The bottom line is that current Medicaid expansion is good for the healthcare provider world. With so many medical bills going unpaid by people who cannot afford the care they have received, hospitals can rest easier if their patients are covered by Medicaid and the ACA. Medicaid expansion is a breath of fresh air for hospital revenue cycle management. With continuing expansion and more patients eligible for Medicaid, hospitals will actually have more funds coming in. The result of this is hospitals becoming able to offer better care to their patients and provide more jobs for healthcare professionals.
The vast majority of hospitals’ uncompensated healthcare costs comes from the percentage of the population that is low-income and either uninsured or underinsured. Medicaid expansion means that more of these people get the coverage they need, and hospitals get paid for the services they provided. The biggest issue here, then, is making sure patients who can’t afford their healthcare get the coverage they need. But the application process for Medicaid and other Marketplace programs is difficult and complicated.
That’s where DECO comes in: our job is to make the whole process simpler and easier, so that patients get the coverage they need and hospitals get compensated for the services they provided. We will get right in the middle of the process to help you help your patients get the assistance they need in paying their medical bills. We will fill in the gaps between healthcare provider and patient and make the entire process run more smoothly, to the benefit of all involved. If your healthcare establishment is having difficulties recouping lost expenses from patients’ unpaid medical bills, contact DECO today!