NC Budget and Tax Center

Medicaid expansion matters to educators and students

Prescription to apply for health insurance with personal computing tablet and stethoscope.

Today, as educators gather in Raleigh, one of their five demands this year is to expand Medicaid to improve the health of students and their families. While students themselves would not gain new health care coverage through closure of the coverage gap, research shows that when parents become newly eligible for Medicaid coverage, they also enroll their children in coverage.

Read more about the benefits of Medicaid expansion for our students in the newly released report from the NC Justice Center here.

Suzy Khachaturyan is a Policy Analyst at the Budget and Tax Center, a project of the North Carolina Justice Center.

NC Budget and Tax Center

The real facts on how Medicaid Expansion will help North Carolina

Here are the real facts about how Medicaid Expansion can help people in North Carolina live healthier lives and have the health insurance that they need.

FACT: Medicaid coverage improves health and financial security.

Health insurance provides financial security by protecting people from catastrophic, unexpected medical expenses. Medicaid serves this purpose by protecting individuals and families with low incomes. Numerous studies show that poor health is associated with a higher risk unemployment and job loss.

Many studies, including the Oregon Health Insurance Experiment where low-income individuals were randomly selected to receive Medicaid coverage, point to the benefits of improved health outcomes as a result of health insurance coverage. Research findings on the clinical outcomes from participants in the coverage experiment include an increase in overall health care utilization, self-reported health, and reduced financial strain. Other studies have found reduced mortality rates and improvements in self-reported health among adults.

FACT: Expanding Medicaid will allow North Carolina to serve more people and won’t harm people currently covered by Medicaid. Read more

NC Budget and Tax Center

N.C.’s public health investments lag behind population growth

This past Saturday concluded National Public Health Week 2019, which makes this a good time to revisit the level of investments that North Carolina leaders have made in public health and other areas that are known to affect health.

Last September, we highlighted the ways that public investments are tied to improved health outcomes. A growing body of research shows that funding for local health departments, in particular, is tied to fewer adverse outcomes and improved health, even when controlling for community differences in demographics, socioeconomic characteristics, and medical resources.

And yet, North Carolina lawmakers have agreed to spend fewer dollars on public health efforts in the state, even as the population has increased. Instead, investments should be made in strategies that are proven to help communities thrive, including in public health, in addition to other areas such as education and housing. Together, these cross-sector approaches help to build a culture of health that works to ensure that everyone can live in a healthy, thriving community.

Suzy Khachaturyan is a Policy Analyst with the Budget and Tax Center, a project of the North Carolina Justice Center.

Commentary, News

Amid N.C. Medicaid debate, Utah foregoes federal dollars in partial Medicaid expansion

Amid a roiling debate in North Carolina over Medicaid expansion, one U.S. state has opted for a partial expansion.

Last week, the Centers for Medicare and Medicaid Services (CMS) approved Utah’s 1115 Medicaid demonstration waiver, which would introduce partial Medicaid expansion and, with it, no enhanced federal match funds.

While the Affordable Care Act (ACA) provides an enhanced federal match rate of 90 percent beginning in year 2020 and each year thereafter for states that choose to expand, states must expand coverage to individuals up to 138 percent of the federal poverty level (FPL) in order to receive the higher match.

As a result of its limited expansion, Utah’s Medicaid match will remain at its existing federal rate of 68 percent, foregoing nearly $1.5 billion in federal funds during the first two fiscal years alone. It is likely to result in overall budget losses for the state.

In November, Utah voters approved full Medicaid expansion, up to 138 percent FPL, via a ballot measure that would provide coverage to approximately 150,000 newly eligible individuals in the first year. However, the following month, the Utah legislature ignored the will of voters by passing a bill which would only extend coverage up to 100 percent FPL.

The bill was signed into law in February 2019, and it includes plans to submit additional waivers in phases that will implement additional barriers to coverage – including work reporting requirements, per capita enrollment caps, and lock-out periods – in addition to requesting higher federal match rates.

Utah’s partial Medicaid expansion will leave more than 40,000 adults – those between 101 and 138 percent FPL – without Medicaid. While these individuals are eligible for coverage and subsidies in the ACA Marketplace, deductibles and out-of-pocket costs would prove a significant financial barrier to coverage and may result in those individuals foregoing insurance altogether.

Utah’s partial expansion not only leaves a coverage gap, but it fails to take advantage of the federal dollars available to increase affordable coverage for individuals with low incomes. Instead the state could fully close its coverage gap, reap the state budget benefits of full expansion, reinvest in its communities, and boost the well-being of families.

Suzy Khachaturyan is a Policy Analyst with the Budget & Tax Center, a project of the North Carolina Justice Center.

NC Budget and Tax Center

With the influx of federal dollars, Medicaid expansion would pay for itself

Recent estimates of the costs and savings of Medicaid expansion from Governor Cooper’s recommended budget show that closing the coverage gap is a great deal for North Carolina. Given our state’s more than one million uninsured individuals and approximately 626,000 additional Medicaid enrollees expected to be newly eligible, the decision on whether or not to expand coverage is clear.

Each year since 2014, North Carolina has foregone billions of federal dollars as a result of not expanding Medicaid. Beginning in 2020 the federal government will pay for 90 percent of the cost of expansion, and the state’s 10 percent share will be covered through a combination of budget savings and fees collected.

With billions in federal dollars coming into the state, Medicaid expansion would generate significant savings for the state budget – an estimated $30.7 million and $69.3 million, respectively, in the first and second fiscal years. Increased federal Medicaid funding would reduce the need for existing state spending on health care services by state agencies like the Division of Mental Health, the Division of Health Benefits, the Department of Corrections, and other state agencies.

The remaining portion of the state’s share will come from assessing fees on hospital revenues and capitation payments made to Medicaid health insurance plans, common revenue-generating strategies used by states. Because these health care organizations will experience significant patient revenue growth with more insured patients under Medicaid expansion, they stand to benefit on net even after paying the fees.

In addition to the zero net cost of expanding Medicaid, it will allow hundreds of thousands of individuals to become newly eligible for affordable health coverage and achieve the benefits that come with it, including improved health and financial security. In addition, when our neighbors are healthy, we all benefit; it allows people to fully participate in their communities and lowers health care costs for all of us.

While the national conversation centers on health care as a right, North Carolina lawmakers in the General Assembly have the opportunity to cover the uninsured and to do it in a fiscally responsible way. With these data, lawmakers will have a tougher time making the case for why the time isn’t right for Medicaid expansion.