Debt collections declining in states who expanded Medicaid

Since not every state fully implemented the Affordable Care Act, data now exists that can contrast those who did with those who did not. Thirty-one states and the District of Columbia have expanded Medicaid, with nineteen states still remaining.

For those who do not follow this closely, the ACA uses Medicaid expansion as the vehicle to deliver health care coverage for people beneath 138% of the poverty level. The federal government would front 100% of the cost for three years, eventually declining to 90% thereafter. Yet, the Supreme Court said states could opt out of this feature, which 19 still have done so.

Per the attached article, The Federal Reserve Bank of New York in a study finds a benefit to people in states where Medicaid expansion occurred is debt collections have declined. I have written before that the principal reason for personal bankruptcy is medical debt. The study’s authors note:

“U.S. counties that had a particularly high uninsured rate prior to the implementation of the Affordable Care Act have seen the per capita collection balance fall if their state embraced the Medicaid expansion. If not, the collection balance continued to climb.”

Yet, in states where Medicaid was not expanded, debt collection is noticeably more in comparison. Per The Commonwealth Foundation, Kaiser Family Foundation, RAND Corporation, Economic Policy Institute and a George Washington University study, expanding Medicaid helps those in need, helps a state’s economy and helps hospitals, especially rural ones who have high indigent and uninsured costs. The hospitals in Medicaid expanded states are seeing fewer uninsured patients and seeing better operating margins. Now, evidence shows it keeps more folks out of bankruptcy.

Former Ohio Governor John Kasich, who was the most reasonable GOP presidential candidate in the view of many, said expanding Medicaid was a no brainer. He said it would bring $13 Billion to his state over the next several years when announced. It also helped his constituents. During the campaign he remained a supporter of Medicaid expansion, which swam against the GOP tide. It is hard to be a lone advocate in a sea of political animosity.

It is past time for leaders in the remaining states to stop thinking like party representatives and start thinking like financial stewards. Several states gave serious consideration, such as Oklahoma, Alabama, Idaho and Wyoming, to expanding during the spring, but in spite of strong data showing its benefits to the state, its hospitals and people, Republican animosity toward the ACA defeated the proposals. Medicaid expansion would help many, including those Republican constituents in poverty living In rural areas. It should be noted that these are the same folks who feel their party is not doing more for them.

Make a move legislators and help all your people, but especially your constituents.

21 thoughts on “Debt collections declining in states who expanded Medicaid

    • Hugh, he still could be, if Trump takes his sand toys and goes home or runs as an independent. Oklahoma is in dire straights in healthcare and could very much use the expansion. The GOP governor changed her position on this issue, as it was so dire. But, major GOP funders went all out to get the bill defeated, as they cannot have their party acquiescing in an election year in spite of the need. This is the sad state of Republican politics is they would rather see people harmed to win a bad argument. Keith

    • The Convention will certainly be interesting this year. There will certainly be some behind the curtain scheming.
      My hope, if they do indeed pull off booting him out, is that it will wake up the country to the desperate need to reform the primary system.
      Because while seeing Trump pushed to the curb is a lovely thought, the system behind it is very disturbing to me.

      • No question, we need changes in the primary process. But, we need more substantive changes such as a 28th amendment to divorce money from free speech, a much shorter election process, and targeted and meaningful position papers and debates per topic with knowledgeable questioners.

      • I’m thinking that the convention might end up resembling a circus this year. The entire primary system of the two major political parties is broken and in need of change. Hopefully people will continue to work on changing the system after this election cycle; so by the next things are different. 🙂

    • Leiah, those represent the biggest benefactors of the GOP. Most of its electorate are voting against their economic interests and have no idea they are. But, a lot of the arguments are based on zero sum games. I must win and you must lose. The ACA is largely built off a GOP idea with certain changes. Yet, Obama passed it, so the GOP must be against it. The leaders of the Tea Party even supported the ideas before the ACA was passed.

    • You are right. It is working pretty well, but could use several improvements. Fully expanded Medicaid is one area and, if Clinton wins, you will see the remaining states do it. Congress has been strangling the ACA by funding the risk corridors less which are designed to help moderate premiums due to adverse selection. These two hamstrings have been perpetrated by the GOP to see the ACA fail, but people are impacted. Other changes should be considered, but I would like to see a public option where competition is scarce. That will also allow measurement of that model.

    • I agree. The GOP proposal announced yesterday would retrench on covering people and actually throw water on the economic recovery. Plus, the little talked about feature under the GOP proposal of pushing Medicare eligibility back two years is a takeaway, since medical coverage factors into retirement. A solution that would be appreciated and give a lower cost option is to lower the eligibility for Medicare and provide it as a public option in some states where competition is poor. That is the opposite of what the GOP is proposing.

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