The Consequences of State Decisions Not to Expand Medicaid

Today, the Council of Economic Advisers released a report, Missed Opportunities: The Consequences of State Decisions Not to Expand Medicaid, which details the effects of state decisions regarding Medicaid expansion on access to care, financial security, overall health and well-being of residents, and state economies. 

The Affordable Care Act has expanded high‐quality, affordable health insurance coverage to millions of Americans. One important way in which the Affordable Care Act is expanding coverage is by providing generous financial support to States that opt to expand Medicaid eligibility to all non‐elderly individuals in families with incomes below 133 percent of the Federal Poverty Level.

To date, 26 States and the District of Columbia have seized this opportunity, and since the beginning of the Affordable Care Act’s first open enrollment period, 5.2 million people have gained Medicaid or Children’s Health Insurance Program (CHIP) coverage in these States, a tally that will grow in the months and years ahead as Medicaid enrollment continues. In contrast, 24 States have not yet expanded Medicaid—including many of the States that would benefit most and sometimes because State legislatures have defied even their own governors—and denied health insurance coverage to millions of their citizens. Researchers at the Urban Institute estimate that, if these States do not change course, 5.7 million people will be deprived of health insurance coverage in 2016. Meanwhile, these States will forgo billions in Federal dollars that could boost their economies.

This analysis uses the best evidence from the economics and health policy literatures to quantify several important consequences of States’ decisions not to expand Medicaid. That evidence, which is based primarily on careful analysis of the effects of past policy decisions, is necessarily an imperfect guide to the future, and the actual effects of Medicaid expansion under the Affordable Care Act could be larger or smaller than the estimates presented below. However, this evidence is clear that the consequences of States’ decisions are far‐reaching, with implications for the health and well‐being of their citizens, their economies, and the economy of the Nation as a whole.