Impact of Expansion on Coverage
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Improved Patient Outcomes
Enhanced Individual Financial Status
Increased Health System Viability
Enhanced State Financial Position
In Kentucky, after expansion (2014-2016) there was an increase in early stage (1 & 2) breast cancer diagnoses compared to the pre-expansion baseline(2011-2013).
Medicaid expansion was associated with 3.4% increase in all cancer diagnoses and a 6.4% increase in early–stage diagnoses in 611 US counties studied.
In 2014 there was a 13% increase in diabetes diagnoses in the 26 expansion states compared to a 0.4% increase in the non-expansion states.
From 2010 – 2016 Infant Mortality (IM) declined 11% in non-expansion states compared to 15.2% in expansion states.
From 2014-2016 IM increased from 6.4 to 6.5/1000 births in non-expansion states compared to a decline of 5.9 to 5.6/1000 births in expansion states.
The decline in IM from 2010-2015 was most pronounced in African –American infants in expansion states(14.5%) compared to 6.6% in non-expansion states.
10Opioid and other Substance Use Disorders*
• Adults in the expansion population have the highest rate of opioid use disorders among all Americans, and expansion dramatically increases insurance coverage for those with opioid use and other substance use disorders, providing a funding stream for and access to SUD treatment
• Expansion increases access to physical and behavioral treatment for substance use disorders (SUD). For example, adults with opioid addiction and Medicaid coverage are more than twice as likely as those with private insurance or no insurance to have received treatment.
Expansion state residents have greater access to treatment for substance use dependency,
and better treatment outcomes
Since Kentucky expanded its Medicaid program in 2014, Medicaid services for SUDincreased by 700%.
From 2013-2015, there was a 79% decrease in opioid-related hospitalizations for uninsured patients in expansion states.
Expansion increased prescriptions for Medication Assisted Treatment methods for opioid addiction by more than 200% nationwide
*Citations follow on slide 28
Individuals 18-64 y.o. in expansion states have:◦ Higher credit scores
◦ Reduced balances past due as a percent of total debt
◦ Reduced probability of a medical collection balance of $1000
◦ Less likelihood of medical bill going to collections in previous 6 months
◦ Reduction in the probability of a new bankruptcy filing
Hospitals in expansion states saw a decline in uncompensated care cost ,an increase in Medicaid revenue compared to hospitals in non-expansion states ,and an increase in operating and total margins.
Hospitals in expansion states were 84% less likely to close than those in non-expansion states
Expansion of Medicaid for childless adults up to 100% FPL made a hospital 2.5 times less likely to close than those in a non-expansion state.
The higher the uninsurance rate in a county, the greater the impact of Medicaid expansion on preventing rural hospital closure.
The financial benefits due to Medicaid expansion seen in improved total margins, operating margins, and decreased uncompensated care were greatest in areas with previous high uninsurance rates and in rural areas
The best explanation appears to be that childless adults previously seen as uninsured are now Medicaid clients due to expansion.
All Hospitals◦ Median operating margins – 6.5%◦ Median total margins – 0.1%◦ 52% of all hospitals had negative total margins and 75% had
negative operating margins Rural Hospitals◦ Median operating margins – 12.2%◦ Median total margins – 3.5%◦ 88% negative operating margins
State savings from enhanced federal matching rate◦ Pregnant women Maryland $8.2m West Virginia $3.8m Washington $31.5m Arkansas $15.2m
◦ Disability avoidance Kentucky $7.9m Arkansas $17.1m
State savings from replacing general funds with Medicaid funds
◦ Savings from Behavioral Health Michigan $190m Kentucky $21m
◦ Savings from enrolling Inmates Michigan $19m Colorado $5m
State Revenue Gains◦ Increased assessments on insurers and providers California $985m New Mexico $30m Maryland $26.6m Michigan $26m
Increased Employment◦ Louisiana – 1000 new jobs & $4b in new revenues for
providers in FY17◦ In 2014 expansion states had job growth of 2.4% compared
to 1.8% in non-expansion states Example of Financial impact of Expansion◦ LA saved $199m in FY17 and projects >$350m in FY18
18Corrections and Recidivism*
• Prisoners have high rates of mental health problems (56% of State prisoners), substance use addiction (67% of prisoners), and communicable and chronic diseases
• With expansion, most prisoners are Medicaid eligible upon release and can be connected to coverage and care, including for treatment of behavioral health conditions
• Linking prisoners to coverage prior to or upon release improves access to needed care and reduces recidivism
Expansion provides new opportunities to connect prisoners to health care following
release, reducing recidivism
New York and Colorado have estimated that 80 and 90% of their prison populations, respectively, were eligible for Medicaid.
In Ohio, Governor Kasich noted a 10% recidivism rate among prisoners who received addiction treatment after Medicaid expansion.
In Washington, a study done prior to expansion showed enrollment of prisoners in Medicaid resulted in 16% fewer detentions in the year after release.
*Citations follow on slide 28
2020-2023
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Alabama Medicaid Expansion Would Provide Coverage for Parents and Other Low-Income Adults Up to 138% FPL
Alabama Adult Eligibility Levels (% of FPL)
Pregnant women
Aged 65 + or disabled
Parents
Most other adults*
Pre-Expansion Post-Expansion Varies based on long-term care and disability status
138%
141%
13% 138%
2018 Annual Income Corresponding with Selected Alabama Eligibility Limits, by Family Size
FPL 1 2 3 4
13% $1,578 $2,140 $2,701 $3,263
74% $8,984 $12,180 $15,377 $18,574
138% $16,753 $22,715 $28,676 $34,638
141% $17,117 $23,209 $29,300 $35,391
* Additional adults covered pre-expansion include those in need of family planning services (141% FPL); and women with breast/cervical cancer (200% FPL)
** SSI (Supplemental Security Income) level for aged, blind or disabled*** HCBS waiver eligibility level, eligibility for specific waivers depends on long-term care and disability status
74%** 231%***
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Alabama Medicaid Expansion Is a Unique Opportunity to Invest in the Health Care System
In the first year of expansion:• Alabama would receive almost $2 billion in new federal Medicaid funds,
which in turn would result in more economic activity, higher state and local tax revenues, and lower uncompensated care costs
• More than 326,000 would gain coverage• More than $58 million in current State spending could be replaced with
federal funds• State costs would be between $126 and $158 million, after accounting for
State savings from expansionAnd coverage, state budget savings and economic gains from expansion would all increase over time.
The State savings and other economic gains from expansion could be reinvested in the health care system in Alabama, including to support
expansion and other State priorities.
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Summary of Alabama Medicaid Expansion Estimated New Federal Funds and State Costs, SFYs 2020-2023
SFY 2020 SFY 2021 SFY 2022 SFY 2023Number of new enrollees
Lower Estimate 326,700 337,300 345,900 353,400
Upper Estimate 387,000 398,200 407,400 415,500
New federal Medicaid spending in Alabama
Lower Estimate $ 1,715,800,000 $ 1,813,000,000 $ 1,920,100,000 $ 2,027,100,000
Upper Estimate $ 2,013,400,000 $ 2,121,400,000 $ 2,242,400,000 $ 2,364,000,000
New State Medicaid spending in Alabama, prior to savings offsets
Lower Estimate $185,500,000 $212,100,000 $224,200,000 $236,400,000
Upper Estimate $216,600,000 $247,200,000 $260,900,000 $274,700,000
State savings from expansion
Savings from Medicaid and non-Medicaid programs ($58,900,000) ($82,500,000) ($86,800,000) ($87,600,000)
Remaining State costs if savings are re-invested in expansion
Lower Estimate $126,600,000 $129,500,000 $137,400,000 $148,700,000
Upper Estimate $157,700,000 $164,600,000 $174,100,000 $187,100,000
Note: Figures in tables may not sum to totals due to rounding
Figures above do not include higher state and local tax revenues from increased economic activity and lower uncompensated care costs for providers.
343,000* new Medicaid enrollees. 60,000 would be moving from a market place plan , resulting in 283,000 new enrollees bringing additional federal funds to the state.
93% FMAP in 4th quarter of calendar year 2019 and 90% in 2020 and beyond
Per Capita spend of $6120n in 2020. Administrative cost of expansion 1.55% of total yearly
benefit cost
* Becker report 01/2019
** Manatt estimates first year enrollment of 326,000 – 387,000. Manatt 02/2019
2020 2021 2022 2023 Total
Alabama Cost
$227 $251 $258 $265 $1,001
FederalInvestment
$1,969 $2,018 $2,080 $2,130 $8,197
Total Spend
$2,196 $2,269 $2,338 $2,394 $9,197
By forgoing expansion, Alabama is losing over $8 billion of direct economic benefit over the next four years.
Manatt estimates year one Alabama cost at $185 – 216m and federal investment at $1.7 – 2.0B
Savings by utilizing enhanced match rate◦ Pregnant women◦ Disability population◦ Breast & Cervical Cancer treatment program
Using Federal Medicaid funds for activities currently paid with state resources◦ Behavioral health & Substance abuse◦ Prisoners
Enhanced State Revenue through increased tax payments◦ Direct Revenue to providers◦ Indirect revenue due to economic Multiplier
State Savings from Accessing Enhanced Federal Matching Funds
Pregnant women: $13.0 million
SSI blind or disabled: $11.5 million
HCBS waiver enrollees: $0.6 million
Breast & cervical cancer: $0.8 million
Family planning: $0.1 million in SFY 2020 only
Using Federal Medicaid Funds to pay for Activities Currently Paid with State Resources
Inpatient hospital care for prisoners: $12.2 million
Mental health and substance use programs: $33.1 million
Public health programs: $16.5 million
Enhanced State Revenue and Taxes
2020 2021 2022 2023 Total
Direct $1,623 $1,661 $1,712 $1,753 $6,749
Indirect* $1,114 $1,139 $1,173 $1,201 $4,628
Total Impact
$2,737 $2,800 $2,885 $2,954 $11,377
*assumes an economic multiplier of 0.65 -0.75
Federation of Tax Administrators estimate Alabama’s tax burden at 8.5% of income◦ 5.3% state tax rate◦ 3.2% local
FY20 - $2.737 billion @ 5.3% = $145 million in new revenue that will be available in FY21
FY21 - $2.800 billion @5.3% = $148million in new revenue that will be available in FY22
FY22 -$2.885billion @5.3% = $153 million in new revenue that will be available in FY23
FY23 - $2,954 billion @5.3% = $157 million in new revenue that will be available in FY24
2020 2021 2022 2023 TotalState Cost of Expansion
$227 $251 $258 $265 $1001
New Tax revenue
** $145 $148 $153 $446*
Savings from Expansion *
$59 $83 $87 $88 $316
Net $168 $ 23 $23 $24 $239
**$145m in tax revenue generated in FY20 available for use in FY21
*does not include $157m in tax revenue generated in FY 23 for use in FY24
Improves health outcomes for real people
It improves the financial status of our citizens
It helps keep health care in rural areas
It provides over $11billion in economic impact to Alabama over 4 years.
“There is a tide in the affairs of men, Which taken at the flood, leads on to fortune. Omitted, all the voyage of their life is bound in shallows and in miseries. On such a full sea are we now afloat. And we must take the current when it serves, or lose our ventures.”
BrutusJulius Caesar