Medicaid Expansion

The Medicaid program offers federal funding to States to assist pregnant women, children, families in need, the blind, the elderly, and the disabled in obtaining medical care [42 U. S. C. §1396d(a)]. The ACA as written sought to expand the scope of the Medicaid program by increasing the number of individuals the States must cover. The ACA planned to do this by increasing income limits to qualify for state Medicaid programs and consequentially would increase federal Medicaid spending to help accommodate these increases. One major caveat was that if a State did not comply with the ACA’s coverage require ments, it could have lost not only the additional federal funding but all of its federal Medicaid funding.

The Supreme Court has re-interpreted this regulation to indicate that while the federal government can offer and provide funding grants for state Medicaid programs, it cannot penalize states by removing all federal Medicaid funding if the state Medicaid program fails to meet all of the grant requirements. Instead, States that do not wish to accept additional monies for Medicaid expansion can be penalized only by not receiving the money of the additional federal grant funding.

Understanding how the individual States will react to the new Medicaid provisions and whether there will still be incentives for them to expand their state Medicaid enrollment will take time. Ultimately, the implementation of the ACA at the State and agency level as well as the local interpretation of and administration of these statutes may have small variation. Time will determine whether appropriate program management and implementation can provide movement on these measures with timely and clear action.