Academic journal article Inquiry

The Expansion of Medicaid Coverage under the ACA: Implications for Health Care Access, Use, and Spending for Vulnerable Low-Income Adults

Academic journal article Inquiry

The Expansion of Medicaid Coverage under the ACA: Implications for Health Care Access, Use, and Spending for Vulnerable Low-Income Adults

Article excerpt


The expansion of Medicaid coverage under the Affordable Care Act offers the potential for significant increases in health care access, use, and spending for vulnerable nonelderly adults who are uninsured. Using pooled data from the Medical Expenditure Panel Survey, this study estimates the potential effects of Medicaid, controlling for individual and local community characteristics. Our findings project significant gains in health care access and use for uninsured adults who enroll in Medicaid coverage and have chronic health conditions and mental health conditions. With that increased use, annual per capita health care spending for those newly insured individuals (excluding out-of-pocket spending) is projected to grow from $2,677 to $6,370 in 2013 dollars, while their out-of-pocket spending would drop by $921. It is expected that these increases in spending would be offset at least in part by reductions in uncompensated care and charity care.


Medicaid, uninusured, access to care, health care use, health care spending, vulnerable adults


While many Americans will benefit from national health reform, low-income uninsured adults are among those with the most to gain since many will become newly eligible for coverage under the Medicaid program. At the heart of the Affordable Care Act (ACA) of 2010 is the option for states to enact a major expansion of Medicaid eligibility in 2014, covering most adults under age sixty-five with incomes up to 133 percent of the federal poverty level (FPL) or up to 138 percent, including a standard 5 percent "income disregard." In this paper, we explore how that Medicaid expansion might affect health care use and spending for some of the most vulnerable uninsured adults--low-income adults with chronic health conditions. We also conduct analyses on a subset of adults with chronic health conditions: those with mental health conditions.

The prevalence of chronic conditions, including mental health conditions, is high among uninsured adults. Recent national statistics indicate that approximately one in three uninsured adults has a chronic health condition, and approximately one in nine has a mental health condition or a substance abuse disorder or both. (1) Since prevalence rates are similar or higher for uninsured individuals with incomes below poverty, it is likely that substantial numbers of those adults who will be newly eligible under the ACA's Medicaid expansion will have a chronic condition, with many also having a mental health condition. Individuals with a chronic condition tend to have high medical care needs and, consequently, account for a disproportionate share of health care spending (Anderson 2010; Druss et al. 2001).

For those who are eligible for coverage, the Medicaid program covers a comprehensive range of benefits addressing physical and mental health needs, including coverage for acute care, ambulatory care, and prescription drugs. By contrast, the health care safety net for the uninsured is a patched-together system; many individuals rely on community-based clinics and emergency departments (EDs) for their care, or they delay care or get no health care services at all (Kaiser Family Foundation 2012b). By providing access to a broad range of health services at no cost or low cost, we would expect the expansion of eligibility for Medicaid to yield improvements in access to, and use of care for low-income uninsured adults, as well as in better health (Hadley 2007; Sommers, Baicker, and Epstein 2012).

This paper provides insight into how the Medicaid expansion under the ACA will likely improve access to health care for low-income uninsured adults with chronic conditions. Building on previous research (Coughlin, Long, and Shen 2005; Hadley and Holahan 2003-2004; Kaiser Family Foundation 2012a; Ku and Broaddus 2008), we use data from the Medical Expenditure Panel Survey (MEPS) to compare health care access, use, and spending for low-income uninsured adults with chronic conditions overall and those with mental health conditions to their counterparts with Medicaid coverage. …

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