Some States Could Gain From Early Expansion of Eligibility for Medicaid

Some states are poised to benefit from provisions in the health reform law that will help them implement an early expansion of their Medicaid programs, Kaiser Health News reports.

As of Thursday, states can apply for federal funds to expand their Medicaid programs to cover residents with annual incomes up to 133% of the federal poverty level. States that pursue the expansion would need to continue paying their current share of the Medicaid costs until increased federal support takes effect in 2014 (Weaver, Kaiser Health News, 4/1).

The federal government beginning in 2014 will pay 100% of the cost of covering newly eligible Medi-Cal beneficiaries. The federal government will reduce its share to 95% in 2016 and then to 90% in 2020 (California Healthline, 3/25).

Maine, Minnesota, Washington state and a few other states already provide Medicaid coverage to residents with annual incomes higher than the federal poverty level. Currently, these states cover a significant portion of the expanded coverage.

However, the offer of new federal matching funds could allow these states to shift a portion of their cost burden to the federal government.

CMS is expected to release further guidance about the Medicaid expansions by next week (Weaver, Kaiser Health News, 4/1).