Industry insiders predicted an increase in Medicaid enrollment in states that did not expand Medicaid eligibility under healthcare reform, but so far, that forecast hasn't panned out.

The combined Medicaid enrollment of the 24 states that did not expand Medicaid eligibility actually decreased slightly from July 2013 to January 2014, according to Decision Resources Group data. Medicaid enrollment was expected to increase in the non-expansion states due to the so-called woodwork effect, in which individuals seeking subsidies through the health insurance exchange find out they are eligible but not enrolled in Medicaid.

But of the 24 states that did not expand Medicaid prior to January 2014, only 10 had enrollment increases, including Florida, North Carolina, and Pennsylvania.

While economic struggles and the resulting lack of income for people is a key factor driving Medicaid enrollment, some non-expansion states have also used Express Lane Eligibility, which takes information from government databases to determine and simplify eligibility, to enroll children who were eligible but not enrolled in the program.

Non-expansion states with notable decreases in Medicaid enrollment include Nebraska at 4 percent and Texas and Utah at nearly 3 percent.

However, the numbers likely will tell another story in later data releases. This was the first year that people were required to obtain health insurance coverage, and glitches in federal and some state exchanges forced people to delay obtaining policies. In addition, open enrollment was from Oct. 1, 2013, to March 31, 2014, and more people likely sought coverage later in the enrollment period than in the beginning.

New Hampshire, a moderate swing state, and Michigan, which has a Republican governor, expanded Medicaid eligibility in August 2014 and April 2014, respectively.

While the decision whether to expand Medicaid eligibility has come down to politics in most states, the financial implications are striking. According to a report from the Urban Institute and Robert Wood Johnson Foundation, states not expanding Medicaid will miss out on more than $423 billion in federal funding from 2013 to 2022. Hospitals in these states will not receive almost $168 billion in Medicaid reimbursements during the same timeframe.

Only time will tell if these factors drive more states to expand eligibility. The outcry from hospitals that lose out on reimbursement funding may become too loud to ignore.

 

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