The Federal Government: The Medicaid Expansion as a Program (Research Paper Sample)

Medicaid Expansion
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Institution
Medicaid is a program formulated by the federal government but run by the state. It aims to provide medical services to low-income citizens. At first, all states were required to expand Medicaid, however, a Supreme Court ruling in June 2012 made it optional. As a result, people in the states that do not expand, and are below a hundred percent of poverty do not have access to subsidized private coverage or Medicaid ("Medicaid Expansion Under the Affordable Care Act", 2013).
In my text, am going to focus on the state of Texas that has not yet expanded Medicaid. There are several decisions related to such a decision. Firstly, the state will forego billions of dollars in federal Medicaid funds. This lowers economic growth and job opportunities in the state. Hospitals as well will lose a lot of funds that was slated to facilitate medical care and Medicare reimbursements. Without these funds, the state will have to prepare a tight budget to cover medical attention costs for its citizens. As a result, there would be a deficit of funds required to support other economic sectors.
Eligibility for Medicaid to the citizens of a state that does not expand is becomes limited. The median income limit for parents goes down greatly – around just 44% of poverty or an annual income of $8,840 a year for a family of three. Moreover, nearly all states not expanding childless adults remain ineligible. Other options for coverage explored by the citizens will also be fruitless according to the Affordable Care Act (Norman, n.d.).
A decision to opt into Medicare by states comes with several pros and cons. I will first highlight the advantages. The enhanced federal match of 100% for the first three years (2014-2016) and thereafter 90% to 95% is a good financial deal for the state. Further, the state can prefer a three-year full federal funding and opt out in 2017. Also, there is increased economic output regarding job employment. The funds received from federal government helps facilitate this.
Medicaid eligibility expansion greatly assists hospitals. It provides funds that help in covering uncompensated care, bad debts, and payment cuts. Not to mention is the acquisition of new and modern facilities to promote health care (Fischer, Purtle, & Corbin, 2014). Also, health disparities are reduced. In most cases the Medicaid expansion population is mainly the low-income earners. Thus, nonexpansion would unfairly hurt them. The expansion also goes alongside reducing the racial, ethnic and geographical disparities.
On the other hand, Medicaid expansion has several disadvantages. Firstly, it leads to a large budget in out years. It binds future leaders to a large spending budget that would leave priorities such as education inadequately funded. The spending is too much and sometimes it may prove unsustainable. This leads to the risk of bait and switch in federal matching funds.
Woodwork effect is bound to increase the number of those enrolled in Medicaid significantly. The expansion will lead to more eligible persons enrolling for Medicaid. The cost of the woodwork population will hit hard on the state budgets. The state's current provider will be highly stretched when low and moderate uninsured individuals are enlisted in the Health Insurance Exchange. The state lacks adequate inpatient and outpatient capacity to take on a large increase in the Medicaid population. Simply, this puts pressure on an already strained health care system (Medicaid expansion, 2012).
According to the ruling granted by the Supreme Court in 2012, states that opt out of the Medicaid expansion can seek other approaches to medical care. Some states such as Arkansas, Iowa received approval by the CMS to create premium assistance programs. The programs Medicaid funds to acquire private coverage for newly eligible Medicaid beneficiaries. Alternatively, expanding a state’s traditional Medicaid program is ideal, but it involves incorporating new features such as using health savings accounts and cost-sharing to healthy behaviors—was approved by CMS in December 2013. This is the case with the state of Michigan (Norman, n.d.).
These alternative models allow states to use funds from the federal government to cover previo...