States Expanding Medicaid Might Face Higher-Than-Expected Costs
States expanding Medicaid under the Affordable Care Act might face higher-than-projected costs, particularly for mental health care services, according to a study published in Medicare & Medicaid Research Review, Modern Healthcare reports.
For the study, researchers from Harvard University and the Urban Institute interviewed high-ranking Medicaid officials in California, Connecticut, Minnesota, New Jersey, Washington and Washington, D.C., which have voluntarily expanded their Medicaid programs since 2010. The researchers wanted to identify challenges those areas faced to help prepare states that will expand Medicaid under the ACA beginning in January 2014.
The study found that states' initial enrollment and cost estimates "often diverg[ed] significantly from the actual outcome." For example:
- Connecticut enrolled 84,000 new Medicaid beneficiaries in the first year of expansion, nearly twice the number that was predicted; and
- Washington, D.C., inaccurately estimated the cost of HIV drugs for new Medicaid beneficiaries who were moving off the DC Healthcare Alliance because the Alliance program had provided the drugs at discounted Department of Defense rates for which Medicaid beneficiaries were ineligible.
The study also found that new Medicaid beneficiaries had greater-than-predicted use of behavioral health services, including treatment for substance use disorders. The researchers said this finding could mean the Medicaid expansion will extend such care to a traditionally underserved population, but they cautioned that states likely would have to better coordinate mental health services by boosting provider capacity and care coordination (Dickson, Modern Healthcare, 11/26).
South Carolina, Other States See Medicaid Enrollment Increase Without Expansion
In related news, South Carolina and several other states that opted out of the ACA's Medicaid expansion still will see substantial enrollment increases, partly because of increased awareness about insurance requirements and states' growing outreach efforts, McClatchy/Kaiser Health News reports.
Officials in South Carolina are projecting a 16% increase in enrollment by the end of June 2015, which is triple that of a typical year and higher than the 12% increase expected by most states that are expanding Medicaid under the ACA.
South Carolina officials say publicity about the ACA, along with the ACA's individual mandate, are attracting people who had been eligible for Medicaid but were not who have not yet enrolled. In addition, the state recently overhauled its enrollment process for Medicaid by developing an online enrollment system and proactively tracking down eligible residents by using government databases, among other things.
Meanwhile, Utah and Idaho -- neither of which plan to expand Medicaid -- each have projected 14% enrollment increases. Overall, states that decided against the Medicaid expansion can expect a 5% increase in Medicaid enrollees, according to data from the Kaiser Family Foundation's Commission on Medicaid and the Uninsured (Galewitz, McClatchy/Kaiser Health News, 11/26).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.