Medicaid Eligibility Expansion

In deciding whether to expand Medicaid eligibility under the Affordable Care Act (ACA), governors and state legislatures face a complex, politically and fiscally challenging choice. The decision on Medicaid eligibility expansion is already a hot topic in state capitals and state election campaigns. The politics and policy of Medicaid reached a fever pitch during the November elections IN 2016. In this essay, I will outline arguments for state to opt for Affordable Care Act Medicaid eligibility expansion. The ACA went into effect in January 2014, the ACA originally expanded Medicaid eligibility to most adults between age 18 and 64 with incomes below 138 percent of the federal poverty level (FPL).
According to the Congressional Budget Office

By itself, the streamlining is expected to, significantly increase Medicaid program enrollment, reduce lapses or interruptions in Medicaid coverage, and lengthen the average time individuals are enrolled in Medicaid.
For Medicaid costs of the expansion population, ACA offers states with enhanced federal match 100 percent in CY 2014-2016 and thereafter phasing down from 95 percent to 90 percent. This compares to the standard federal Medicaid match rate of 50 percent to 77 percent, which varies based on a state’s relative per capita income. The standard federal match rates will continue to apply for the benefit costs of all other Medicaid enrollees, including individuals entering Medicaid as a result of the streamlined, simplified processes for applications, eligibility determinations, and renewals required under CMS rules. In the beginning the ACA Medicaid eligibility expansion was mandatory for states. If a state failed to implement the expansion, it faced the possible loss of all federal Medicaid funding – effectively making it an offer the states could not refuse. However, in NFIB v. Sebelius, the U.S. Supreme Court ruled that Congress could not coerce states into expanding Medicaid. As a result, the ACA Medicaid eligibility expansion is now optional for each state. States have received official guidance from CMS, including revised ACA regulations

The first reason states should expand the ACA Medicaid eligibility is because it is a good financial `deal for the states. The enhanced federal match of 100% for the first three years (2014-2016) and thereafter 90% to 95% is a good financial deal for the state. This is far higher than the 50 percent to 77 percent states received before for rest of Medicaid benefit spending. While a future Congress could renege and reduce or eliminate the enhanced federal match rate for the ACA expansion population, a state could then presumably opt out. Also, a state could opt in for only the three years with 100% federal funding, setting up a sunset provision to automatically opt out in