Critics of Medicaid expansion aren’t telling the whole story


Photo by Kai Hendry used under a Creative Commons license.
Photo by Kai Hendry used under a Creative Commons license.

Opponents of accepting federal funds to expand health coverage in Oklahoma have recently been citing a report from the Foundation for Government Accountability (FGA), a think tank based out of Florida. The report claims that states should refuse federal funds to expand coverage to low-income residents because the uninsured rate did not fall after Medicaid expansions in Arizona and Maine during the early 2000s.

However, FGA’s analysis leaves out a lot of the story. States that expanded Medicaid saw Medicaid enrollment rise, but the uninsured rate remained flat because a significant number of Americans nationwide lost their private insurance during the study period (2002-2011). Not everyone who lost their insurance was eligible for Medicaid, and so they still went uninsured – something that, due to the Affordable Care Act, won’t happen this time.

Private employer-sponsored insurance declined nationwide during the study period.

Employer-sponsored insurance (ESI) has been in a decade-long decline for low-income Americans. Nationwide, the percentage of America’s low-income workers with employer-sponsored insurance dropped nearly in half from 2001 to 2010, falling from 42 percent to 24 percent.

Although rates of employer-sponsored insurance held somewhat steadier for middle- and upper-income Americans, they too saw coverage drop during the Great Recession. Those who kept their jobs still often lost their health insurance: rates of employer-sponsored insurance for those earning between 200 and 400 percent FPL ($23,340 – $46,680 per year for a single person) dropped from 71.6 percent in 2007 to 62.2 percent in 2010. Even upper-income Americans – those earning 400 percent FPL and above – were affected: their ESI rates dropped from 85.6 percent in 2007 to 81.2 percent in 2010.

Medicaid was a crucial safety net during the Great Recession.

The Great Recession beginning in late-2007 caused unprecedented job loss nationwide and knocked many Americans into poverty. Notably, despite this economic calamity, the number of uninsured children actually declined over this period, thanks to Medicaid and the Children’s Health Insurance Program (CHIP).

Medicaid helped some adults too, but not enough to counteract the decline in private insurance. Maine and Arizona only expanded coverage to those earning 100 percent of the federal poverty level (FPL) or below. Residents earning slightly above the poverty line continued to be left out – earning too much to qualify for Medicaid, and typically too little to be able to afford pre-health care reform private insurance on their own.

Nevertheless, expanding coverage in Maine and Arizona saved lives. A study in the New England Journal of Medicine found that Medicaid expansions in New York, Maine, and Arizona were associated with significant drop in mortality among adults (6.1 percent, or 19.6 fewer deaths per 100,000 adults), compared with states that did not expand the program. The expansion also allowed residents on Medicaid to access needed care without risking bankruptcy.

The whole story

In short, millions of Americans lost insurance during difficult economic times, and Medicaid only partially filled the gap. The safety net saved lives and protected millions of children and adults, but it still has gaps. Making this into a case against accepting federal funds to extend coverage takes some contortions of data and logic.

Furthermore, the health insurance marketplaces created by the Affordable Care Act mean that people who don’t qualify for Medicaid but don’t have employer-sponsored insurance – essentially, those who were uninsured in FGA’s Maine and Arizona statistics – now have affordable health insurance available to them. In case of job loss or change in insurance status, Americans can enroll at any time during the year, further ensuring continuous access to needed care. The opportunity for affordable, quality health care is here – if only states will accept it.

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Carly Putnam joined OK Policy in 2013. As Policy Director, she supervises policy research and strategy. She previously worked as an OK Policy intern, and she was OK Policy's health care policy analyst through July 2020. She graduated from the University of Tulsa in 2013. As a student, she was a participant in the National Education for Women (N.E.W.) Leadership Institute and interned with Planned Parenthood. Carly is a graduate of the Oklahoma Center for Nonprofits Nonprofit Management Certification; the Oklahoma Developmental Disabilities Council’s Partners in Policymaking; The Mine, a social entrepreneurship fellowship in Tulsa; and Leadership Tulsa Class 62. She currently serves on the boards of Restore Hope Ministries and The Arc of Oklahoma. In her free time, she enjoys reading, cooking, and doing battle with her hundred year-old house.

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