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Medicaid Expansion Moving Ahead in Less Than Half of U.S. States

The Medicaid expansion provisions outlined under the Patient Protection and Affordable Care Act will be adopted by less than half of all states, according to a new analysis from Avalere Health. The report says that 27 states will not adopt the expansion, at least not by the January 1, 2014 deadline. However, legislatures in six of the 27 states have not absolutely ruled out the possibility of expansion, though the analysts say that it is very unlikely for the states to change their direction now.

Under the terms of the healthcare law commonly referred to as “Obamacare”, Medicaid programs in the individual states would expand greatly to include a larger number of low income Americans. The terms of the expansion state that anyone, individual or family, earning up to 133% of the federal poverty limit will become eligible for Medicaid in 2014.

Yet in 2012, the Supreme Court ruled that the mandatory expansion provision under the terms of the original law was not constitutional. Because the court overturned that provision, states gained the ability to decide for themselves if they wanted to adopt the Medicaid expansion. So far, 23 states have indicated they will expand the program, and the remaining 27 will definitely, or very likely, not choose to do so.

Experts say that the expansion of the Medicaid program will add another 5 million Americans into the Medicaid ranks, and that by 2017 an additional 10 million individuals could be added. If all states chose to adopt the expansion, experts say that there could be another 21 million people covered by Medicaid by 2019. The millions more Americans who would be covered under the program would join the estimated 50 million Americans already enrolled in the state provided health insurance system.

As outlined under the Affordable Care Act, the federal government will be responsible for covering the additional cost of the expanded enrollment program for the first several years. Over time, states will begin paying a small portion of those expanded costs, but the initial tab will fall entirely on the federal government’s shoulders. By 2020 states will have to pay for 10% of the expansion costs, while the federal government will be responsible for paying for the remaining 90%.

Along with the expanded Medicaid program that takes effect on January 1, 2014, another key portion of the healthcare law will see subsidized private health coverage programs hit the market on the same date. These programs will be designed to allow people who purchase their own health insurance to go to state or federal run insurance exchanges to obtain competitive healthcare plans. Plan details will be revealed beginning in October, and the plans will become available in 2014.

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