Issue Brief | Jun 2, 2015

The Impact of Medicaid Expansion on Uncompensated Care Costs: Early Results and Policy Implications for States

Deborah Bachrach, Patricia Boozang, and Mindy Lipson, Manatt Health Solutions

Since implementation of the Affordable Care Act (ACA), the 30 states that have expanded Medicaid have enrolled more than 10 million people in Medicaid or the Children’s Health Insurance Program and the collective rate of uninsured individuals in these states has fallen from 18 percent to less than 11 percent. Recent research by Manatt Health Solutions looked at the fiscal implications of expansion and found that, in addition to coverage gains, expansion states experienced significant budget savings and revenue gains. This issue brief, the third in this series prepared by Manatt Health Solutions, examines early data on expansion-related decreases in uncompensated care costs and related state budget implications. It also looks at impending reductions in federal support for Medicaid Disproportionate Share (DSH) payments and waiver pools made available to support hospital uncompensated care costs prior to the Medicaid expansion authorized and funded under the ACA.