Health Affairs Web First: ACA Did Not Negatively Impact Budgets Of States Expanding Medicaid In 2014–15

A new study, released by Health Affairs as a Web First, is the first national look at the impact on state budgets of the Medicaid expansion under the Affordable Care Act (ACA). The authors analyzed official budget reports from all fifty states for fiscal years 2010–15 (the most recent year for which data are available), a period that extended roughly 1.5 years into the ACA's Medicaid expansion. According to the study, states choosing to expand Medicaid experienced an 11.7 percent increase in overall Medicaid spending, with a 12.2 percent increase in spending from federal funds in 2014–15 compared to the pre-expansion years 2010–13. The change in Medicaid spending using state funds was an nonsignificant 2.4 percent. In a related finding, the authors discerned no significant reductions in spending on other categories of state spending, such as education and transportation.

The primary data for the study came from the annual State Expenditure Reports released by the National Association of State Budget Officers (NASBO).  "While some analysts and politicians had voiced concerns that Medicaid expansion could lead to increased state spending or squeeze out competing spending for other priorities such as education, we found no evidence to support either of these concerns by 2015," the authors concluded.  "However, given the states' heavy reliance on the increase in federal funding, any substantial reduction in federal Medicaid support to states would undoubtedly undermine the coverage gains achieved to date and would likely put other state budgetary priorities at risk."

Sommers's primary affiliation is with the Harvard T. H. Chan School of Public Health; Gruber is with the Massachusetts Institute of Technology.

This study, which was supported by the Agency for Healthcare Research and Quality, will also appear in Health Affairs's May issue.

from Health Affairs BlogHealth Affairs Blog http://ift.tt/2oviFXS