State and Local Coverage Changes Under Full Implementation of the Affordable Care Act

REPORTState and Local Coverage Changes under Full Implementation of the Affordable Care ActJuly 2013 PREPARED BYGenevieve M. Kenney, Michael Huntress, Matthew Buettgens, Victoria Lynch, and Dean Resnick,The Urban InstituteState and Local Coverage Changes under Full Implementation of the Affordable Care ActJuly 2013 State and Local Coverage Changes under Full Implementation of the Affordable Care Act1IntroductionThe Affordable Care Act (ACA) of 2010 includes a number of new policies intended to substantially reduce the number of people without health insurance. Key provisions to be implemented in 2014 include new health insurance exchanges, subsidies for coverage in those exchanges, health insurance market reforms, and an individual mandate. The ACA also includes an expansion of Medicaid coverage to individuals with incomes up to 138 percent of the Federal Poverty Level ($15,856 for an individual or $26,951 for family of three in 2013).1 The Medicaid expansion under the ACA became a state option following the Supreme Court ruling in June of 2012. At this point, it is not clear how many states will elect to expand Medicaid coverage.2 If all states were to do so, enrollment in Medicaid is projected to increase nationwide by about 18.1 million and the uninsured would decline by 23.1 million.3This brief provides highlights from new state and sub-state estimates of how the number and composition of individ-uals enrolled in Medicaid/CHIP would change with full implementation of the ACA, including the Medicaid expan-sion (see kff.org/zooming-in-ACA). These estimates provide more detail on the projected coverage changes under the ACA at the state level than in prior research.4 They also provide new information on the expected coverage changes resulting from the ACA at the local level in all states. This analysis demonstrates that there is substantial variation across and within states in the magnitude and composition of the population that is projected to gain Medicaid coverage under the ACA. These estimates also provide guidance on the areas that are likely to experience the largest declines in the uninsured and where the residual uninsured are likely to be concentrated.MethodsThe analysis uses the Urban Institute’s American Community Survey - Health Insurance Policy Simulation Model (ACS-HIPSM). This model simulates decisions of individuals in response to policy changes, such as Medicaid expan-sions, new health insurance options, subsidies for the purchase of health insurance, and insurance market reforms, using data from the American Community Survey (ACS). The estimates draw on a sample of approximately 7.5 million individuals from combined 2008, 2009, and 2010 ACS data. All three years of data were combined to achieve suffi-cient precision at both the state and local level. The data was reweighted so that the distribution of the population by age, race, and sex in the pooled file matches 2011 population estimates published by the Census Bureau. For more detail on the ACS-HIPSM model and the methods underlying this analysis, see the Methods Appendix. For further information, see http://www.urban.org/UploadedPDF/412841-American-Community-Survey-Health-Insurance-Policy-Simulation-Model.pdf.Medicaid Enrollment Increases under the ACAThe demographic composition of Medicaid enrollees shifts under the ACANationally, our model projects a 37.4 percent increase in Medicaid/CHIP enrollment under the ACA, with total enroll-ment rising from 48.3 million to 66.4 million.5 This enrollment includes both people newly-eligible for Medicaid coverage and also new enrollment among adults and children currently eligible for Medicaid coverage but not enrolled. The composition of individuals gaining Medicaid enrollment is projected to differ from the current distribu-tion of individuals covered by Medicaid/CHIP, primarily due to the increased coverage of nonelderly adults, particu-larly those without dependent children, who have historically been excluded from coverage.6 For example, 78.0 percent of new enrollees are adults, compared to 39.3 percent of current enrollees (Exhibit 1). Children will represent a smaller share of Medicaid/CHIP beneficiaries than they currently do. Currently, children represent a majority of enrollees in 45 states, but after the ACA implementation, only 24 states will have more than half of their enrollees under the age of 19 (data not shown). State and Local Coverage Changes under Full Implementation of the Affordable Care Act2New Medicaid enrollees will also differ from current enrollees in terms of their race/ethnicity as well as language spoken at home. For example, 55.0 percent of new Medicaid/CHIP enrollees are white non-Hispanic, compared to 43.1 percent of current enrollees (Exhibit 1). With full implementation of the ACA, the share of the Medicaid/CHIP population that would be living in a Spanish-speaking household is expected to decline.7 Specifically, 71.8 percent of new enrollees live in househ