Templates & Toolkits | Sep 11, 2012

Medicaid Expansion: Framing and Planning a Financial Impact Analysis

Manatt Health Solutions; Center for Health Care Strategies; State Health Access Data Assistance Center

Introduction & Overview

This worksheet and considerations table can serve as a guide for states considering their own Medicaid expansion analysis. The Supreme Court’s decision inNFIB v. Sebelius did not change the underlying Medicaid expansion provisions of the Affordable Care Act (ACA), but did remove the ACA’s enforcement authority for states choosing not to expand. As a result, states are facing an unexpected and difficult implementation decision regarding this expansion. The availability of 100 percent federal match for this population from 2014 through 2016, along with federal match ratcheting down to 90 percent in the later years, is, for many states, a strong incentive to expand Medicaid. Regardless of that incentive, most states are taking a measured and analytical approach to determining the fiscal impact of this choice before making a final decision.

Created by State Network experts at the State Health Access Data Assistance Center (SHADAC), Center for Health Care Strategies (CHCS), and Manatt Health Solutions, this analysis approach is limited to financial considerations related to the state’s decision to expand and therefore excludes many important financial aspects related to the ACA as a whole (e.g. remaining mandatory provisions). State specific Medicaid expansion analysis should take into account existing program structure, available data sources (both state and national) and realistic assumptions about enrollment and costs. States should also note within the analysis whether costs are directly related to the Medicaid expansion or if they are likely to occur despite expansion (e.g., the woodwork effect for individuals eligible but not currently enrolled).