Medicaid directors in the 25 states, plus D.C., expanding eligibility are cautiously optimistic of the benefits, but they're also expecting new costs from some potentially overlooked areas and they're not entirely trustful of Congress.
Twenty of the Medicaid leaders are expecting at least half of the newly eligible residents in their states to enroll and about as many are also expecting a fair number of previously eligible people to enroll, according to a survey by Harvard School of Public Health professor Benjamin Sommers, MD, and four other researchers.
"Our results show that expanding states generally expect high take-up among newly eligible and currently eligible individuals," Sommers wrote in a Health Affairs blog, summarizing preliminary results of the survey.
The so-called "woodwork" or "welcome mat" effect, the promotion of new eligibility drawing people who already qualify, could bring more costs to states, since the federal government will be covering 100 percent (and later 90 percent) of the costs for those newly eligible under the Affordable Care Act, while those eligible under existing thresholds who enroll in 2014 and later years will be reimbursed at the existing 50-75 percent matching rate.
Twenty of the state Medicaid leaders said in the survey that the ACA is likely going to lead to a "moderate" or "large" number of previously eligible individuals enrolling in the program. Nationally, the "woodwork effect" could draw more than 9 million uninsured adults and children, including 1.1 million in California and 900,000 in New York, Sommers has estimated.
With Medicaid being one of the largest parts of state budgets (in many states the largest piece), state Medicaid directors have costs and cost control weighing heavy on their minds going into the next year, Sommers and his team found.
Most of the states expanding Medicaid eligibility are also looking to new payment and delivery models such as medical homes, and many of the Medicaid directors are skeptical that the ACA's funding promises will remain in the long-term.
A majority of the 26 directors surveyed also think it's "possible or likely" that the federal government could cut the Medicaid matching rate over the next decade -- a possibility that lawmakers advocating against Medicaid expansion routinely bring up.
Considering all the other benefits of extending Medicaid coverage, a majority of the 26 directors surveyed expect the expansion to save their states money, although one third of them think that the likelihood of pared-back federal matching rates is so great that their states will end up losing money in the long-run.
While Congress has never actually voted to reduce the matching rate, with GOP criticism to the ACA continuing in Congress and in the states, Medicaid directors are banking on at least some uncertainty.
"These trends demonstrate new approaches and cautious optimism in the face of limited resources and tight deadlines," Sommers and colleagues wrote in Health Affairs.
The top two implementation challenges named by the Medicaid directors were information management systems and coordination with insurance exchanges, including federal interfacing.
As part of mandatory modernization, states have been developing and rolling out new eligibility and claims systems that are notoriously complex, with 90 percent of the costs covered the federal government but only after detailed certification requirements are met.