The Expanding Role of Medicaid in US Health Care

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Yves here. I had no idea that Medicaid was such a heavyweight in total US health care. This is remarkable in what it says indirectly about poverty and income instability in the US. Remember that Medicaid has stringent eligibility requirements and like most US programs for the poor, a complex application process. A disabled and high functioning colleague confirmed it was hard to get through the hoops.

By run75441. Originally published at Angry Bear

Mostly taken from “The expanding role of Medicaid in US health care: A research roundup,, Kerry Dooley Young. May 2023.”

I have added commentary to this report. I do have another report on Medicaid which I have to deep dive to make shorter sense of it. This report includes information going back to Obama’s introduction of the PPACA and the impact of it on Medicaid. It offers information to a reader which they may not be aware of or have forgotten.

Originally published in July 2020. In light of the Republicans’ debt ceiling negotiations with the Biden administration in 2023, involving discussions of a federal Medicaid work requirement, the report is current as of May 24 with some updated statistics. This is a partial of the report. A list of additional studies as recently as April 2023 are this site.

The two largest U.S. health plans share a birthday, July 30, 1965, but they have different roles and public images.

law signed by President Lyndon B. Johnson created Medicare, which serves people age 65 and older, and Medicaid, which covers people considered to be poor by government standards. Both programs also cover people with disabilities, contributing to overlap between Medicaid and Medicare. About 12.2 million people of the about 60 million people enrolled in Medicare in 2018 also had Medicaid coverage.

People tend to remain enrolled in Medicare. In 2022, 55.5 million of the the 63.8 million participants were age 65 and older, according to the 2022 Medicare trustees report. The rest of the enrollees qualified due to disabilities.

Not so with Medicaid, where there is more churn.

For example, about 86.7 million people were covered by the state-federal program at some point during fiscal 2018, according to a December 2019 report from Medicaid and CHIP Payment and Access Commission (MACPAC). But fewer might be covered by the program at any given point in the year, as can be tracked through Medicaid’s website.  (The program posts a monthly snapshot of recent enrollment as well as releasing more extensive data.)

People gain Medicaid coverage when they lose jobs — for instance, during the recession stemming from the COVID-19 pandemic — and drop it when they become employed again. Some people with disabilities also rely on Medicaid coverage while waiting to qualify for Medicare.

While Medicaid is a safety-net program for many Americans, Medicare is more of an aspiration, which enjoys a significant base of bipartisan support.

“You couldn’t move my mother out of Medicare with a bulldozer,” then House Energy and Commerce Chairman Billy Tauzin, a Louisiana Republican, said in 2003, while working on the last major expansion of the federal health program.

“She trusts in it, believes in it. It’s serves her well.”

But there’s a sharp partisan divide about Medicaid. There were no Republican votes for the 2010 Affordable Care Act (ACA), which set the stage for a major expansion of Medicaid that’s still unfolding. Instead Republicans have since tried repeatedly to repeal the ACA, while also reviving in recent years attempts to convert federal funding of Medicaid from an open-ended commitment based on formulas to more limited support though block grants.

GOP’s unsuccessful ACA repeal bids in 2017 foundered, though, in part due to growing support for Medicaid, according to Richard Sorian, a former assistant secretary for public affairs at the Department of Health and Human Services in the Obama administration. Sorian looked at how the 2014 expansion had allowed more people to get access to health care in several states with Republican governors, such as Ohio, as well as in those dominated by Democrats.  Richard Sorian writes;

“For most of its history, Medicaid took a back seat to Medicare, the health benefits program for seniors and others. But many more are leery of touching the program and facing the wrath of the people who elected them.”

Adding . . . some politicians still seek Medicaid budget cuts.

A few statistics show how Medicaid underpins much of U.S. health care.

  • About 1 in 5 Americans get health insurance through Medicaid. It is run by the states with federal financial support and oversight. As of January 2023, more than 85.9 million people in the U.S. were in Medicaid. This according to the latest data posted by the Centers for Medicare and Medicaid Services (CMS). There were about 7 million participants in the Children’s Health Insurance Program (CHIP), considered a sister initiative to Medicaid.
  • Medicaid paid for 43% of all births in the U.S. in 2018, while private insurance plans paid for 49%. Policymakers now are looking to expand Medicaid coverage to try to lower the high rate of maternal mortality in the United States. There are bills pending in Congress that would require Medicaid coverage of new mothers from a 60-day period to the entire year following giving birth.
  • Medicaid is the largest U.S. purchaser of what it calls behavioral health services, which include mental health treatment and services to treat addiction and substance abuse.
  • Medicaid is the primary tool through which the Affordable Care Act (ACA) of 2010 expands the public’s access to health care.

News coverage of the federal government’s implementation of the ACA in 2014 focused heavily on hitches with the startup of the online state and federal exchanges through which people who did not get health plans from their employers can buy medical coverage. These were primarily intended to help people whose employers do not offer health plans. Many people get subsidies to purchase their insurance on these exchanges. Without this help, they might not be able to afford insurance.

About 11.4 million people were covered by these health plans sold on the exchanges for 2020, according to a report from the Centers for Medicare and Medicaid Services (CMS).

These include plans sold by for-profit companies as well as ones from nonprofit insurers.

By late 2018, about 15.1 million people were using Medicaid due to expansion created by the ACA, CMS reported.

States have varied eligibility criteria, including income cutoffs, for Medicaid. Before the ACA, many states largely excluded adults who do not have disabilities,  no matter how little they earned.

President Barack Obama and congressional Democrats intended for all states to raise their Medicaid eligibility requirements to allow adults who work but have incomes just above the federal poverty level to get health insurance. CMS last year authorized Utah’s Medicaid expansion, which will allow coverage for single people with annual income of as much as 138% of the federal poverty level ($17,608). For a family of four, this income cutoff would be $36,156.

Under the ACA, states initially were required to set their cutoff for Medicaid eligibility at a level allowing people with household incomes as high as 138% above the federal poverty level to enroll. It is important to note the actual text of the ACA sets this level at 133%, other provisions of the law nudged the cap to 138%.

In 2012, the U.S. Supreme Court decided that states could choose whether they wanted to raise the threshold for Medicaid eligibility under ACA. In an effort to encourage states to raise their income thresholds to allow more people to qualify for Medicaid, the federal government offered to cover the majority of the cost of covering these new enrollees.

Many Republican state governors initially balked at the offer and GOP political candidates campaigned on pledges to repeal the ACA.

Several Republican leaders, including Gov. Gary Herbert of Utah and then Indiana Gov. Mike Pence, later took the federal government up on its offer. The U.S. opioid epidemic helped persuade GOP holdouts to expand Medicaid. As of May 2023, 10 states have not taken formal action to expand Medicaid, according to a tally kept by the Kaiser Family Foundation.

In some states expanding their Medicaid coverage, Republican governors added conditions for people who are able to enroll thanks to increased income thresholds, including payments of premiums. Congressional and state Democrats have objected to Republican attempts to add work requirements to Medicaid participation for adults who do not have disabilities. They have argued that many people added as a result of the expansion already work and documenting employment is a significant administrative burden.

To help journalists report on Medicaid, we’ve summarized a few studies below to help reporters understand the key debates happening about this program.

At the heart of Medicaid research are persistent questions about how well the massive state-federal health program works. Studies published to date show mixed results on questions of whether having Medicaid coverage helps participants improve or maintain their health.

For example, one study found middle-aged people who live in states that expanded Medicaid under the ACA are less likely to die of heart disease.

But discussions about Medicaid often quickly loop back to the somewhat surprising findings of a 2008 experiment in Oregon involving Medicaid. After Oregon officials found they had funds for a limited expansion of the state’s Medicaid program, they used a lottery to select about 30,000 people from a waiting list of almost 90,000. This approach allowed economists a rare opportunity to study the effects of Medicaid coverage in a group of people randomly selected to enroll in the state-federal health plan.

Some findings from studies of the Oregon experiment disappointed advocates for Medicaid expansion. These findings include research that seems to contradict a common theory that people newly enrolled in Medicaid  would use emergency rooms less often for basic health care needs if they could afford to see a primary care doctor by participating in Medicaid. Visits to a primary care clinic cost significantly less than emergency room visits.

In recent years, many researchers have sought to assess the early impacts of the ACA’s Medicaid expansion. The results of the Oregon experiment cast doubt about the possible benefits of Medicaid coverage for a group that had been randomly selected to receive coverage, writes Sarah Miller, an assistant professor at the University of Michigan’s Ross School of Business, and her co-authors in a 2019 paper.

“The inconclusive nature of these results has led to skepticism among some researchers, policymakers, and members of the media as to whether Medicaid has any positive health impacts for this group.

In their paper, though, Miller and her co-authors estimate Medicaid expansion may have prevented 4,800 deaths in their sample population among people ages 55 to 64, or roughly 19,200 fewer deaths over the first four years alone. Miller and her co-authors also offer an estimate of what many states’ decisions against Medicaid expansion meant for their citizens.

“Our estimates suggest that approximately 15,600 deaths would have been averted had the ACA expansions been adopted nationwide as originally intended by the ACA.”

In another report Miller and her associates did conclude a broader access to Medicaid appeared to lower the mortality rate in a study focused on people ages 55 to 64, Miller and her co-authors find. An additional University of Michigan study on the relationship between Medicaid enrollment and mortality found a 0.13 percentage point decline in annual mortality, a 9.3% reduction over the sample mean, associated with Medicaid expansion. The effect is driven by a reduction in disease-related deaths and grows over time.

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    1. Alice X

      How about we look through the other end of the telescope? – The $ trillion plus war machine budget is responsible for the entire trillion dollar deficit. A in healthcare for the people is good and war profiteering is bad, or something like that.

      Another way of thinking is that, while Medicaid expansion served a purpose, a universal single payer healthcare system would have been the appropriate approach. But profiteers gotta profit, whether in war or in healthcare. It’s the American way.

      1. Willie

        We get to choose how we bankrupt the budget?

        With the current US war footing (the Fed raises interest rates accordingly; the reason can not be stated) it looks like the old adage is true; we’ve always been at war with East Asia, i.e., NATO has, certainly, and now the Straussian nationalists in charge of foreign policy are adamant . This is likely their final opportunity.

        I’ve tried convincing them otherwise, but they won’t accept my calls.
        I’ve got this; I’ll send them a sternly worded letter.
        But it would be a step too far to ever say to anyone, “I told you so.”

        Extending all my best wishes

      1. jefemt

        Sounds like either Big Med/ Big Pharma or the M I C?

        Ironic duality: death and destruction or ostensibly Life.

        Expensive odd duality… appears the gubmint is the backstop to over-charge in both cases.

  1. Eclair

    Back in early April, listening to a report on NPR while driving, I was totally amazed at hearing that there were currently almost 90 million people covered by Medicaid. Add that to the approximately 60 million people covered (barely, in some cases) by Medicare, and that’s half of the US population. In a government-sponsored single payer health (ahem!) system.

    Here’s a report from the ground with some observations on health care, or the lack of it, and health in general, here in New York state’s Chautauqua County, and adjoining Warren County, Pennsylvania. Both areas are economically deprived and rural: individual median income about 26k and 27k, respectively. Compare that to the 44k median income for Westchester County, NY.

    Flyers announcing fund raisers (spaghetti dinners, pancake breakfasts) to defray the medical expenses of local residents are posted in the local stores and in the free weekly Pennysaver newspaper. Babies with rare birth defects, moms with cancer, dads badly injured in motorcycle accidents, the usual.

    The area has a large and growing Amish population. They do not not have insurance, or, rather, their ‘insurance’ is their social safety net of family and community. Last year, a medical clinic opened in the little village of Lander (a church, a volunteer fire department and a cluster of houses, surrounded by outlying farms.). It does not accept any kind of insurance, and its services range from stitching up cuts to infusion therapy.

    Talking with an Amish friend yesterday, she related how her father-in-law was in a clinic in Mexico, having had 10 inches of his colon removed. The Amish here travel to Mexico for medical procedures on a regular basis. My friend is expecting her sixth child in July, and will travel the 35 miles to the Amish settlement in Conewango Valley to a birthing clinic there. Then, back home, where a rotation of sisters and young women from the community will run the house for a couple of weeks, while she takes time to recover and care for the newborn.

    Another local Amish community, in Frewsburg, NY, sponsors semi-annual fund-raisers, to defray medical expenses for their community members. The events are full pancake breakfasts, with sales of home-baked pies, local cheese, yoghurt and farm-made sausage, and silent auction. The former grange hall is packed.

    Our senior friends and neighbors all seems content with their Medicare Advantage plans. The local hospital has been absorbed into the sprawling UPMC (University of Pittsburg Medical Center) system and sends, for example, heart attack victims, to their facility in Erie, PA. The UPMC helicopter flies over our house on a regular basis.

  2. KidMD

    Medicare does not negotiate drug prices, while Medicaid does. As NC has demonstrated so well, recently approved upcoming negotiations are extremely limited. Handled properly, a shift towards Medicaid could make a huge difference in US medical costs.

    Medicare sometimes leaves patients with huge expenses, while Medicaid does not.

    A major problem with Medicaid is the limited number of participating providers, though Medicare Advantage has similar issues. Anecdotally, many doctors dropped Medicaid (in Virginia at least) when the prior state-run program transitioned to contract multi-insurer management. The difference was similar to the change from Medicare (consistent approval/payment formulas posted online, straightforward billing) to Medicare Advantage (complex and constantly changing coverage, approval and pricing formulas, insurer hassles and denials, topped with hidden and regularly shifting proprietary contracts).

    Personally, as a physician, I did not mind subsidizing care for the impoverished, especially when others covered their share. Subsidizing insurance companies, with rising costs of dealing with imposed complexity and frequent nonpayments, was a different story.

    1. Alice X

      A social system that completely covers primary through tertiary education, and universal health care would be my proposal. Eliminate profiteering for the fundamentals of life. I suppose there is a label for that sort of thinking but I won’t bother naming it.

  3. Joe Well

    >>Medicaid has stringent eligibility requirements and like most US programs for the poor, a complex application process. A disabled and high functioning colleague confirmed it was hard to get through the hoops.

    This depends entirely on the state. In Massachusetts, not complicated at all.

    However, even the most basic application requirement is going to exclude some people who are in direst need, especially if it’s a mental health problem or they are “unhoused”.

    Actually, now that I think of it, the application is simple, but they require proof of eligibility which can be somewhat more of a pain. Here is where to apply:

  4. Rick

    About Medicaid in Oregon aka the Oregon Health Plan – it’s weirdly the best health care plan available. The people I’ve known on it (including a close family member) have had so many fewer hassles than with any other health coverage, corporate or ACA. It just works. Providers seem to take it with less hesitation than Medicare, covers what is needed well including ambulance trips.

    I’d rather have OHP for all than Medicare for all.

    1. Joe Well

      It’s the same with MassHealth in Massachusetts. Amazing that politicians haven’t mined the potential to gin up resentment against recipients.

  5. Telee

    This article from NYT is relevant. Now that covid relief is finished, people are being dropped from Medicaid roles, many because they don’t understand the paper work required.

    Hundreds of Thousands Have Lost Medicaid Coverage Since Pandemic Protections Expired – The New York Times (

  6. LAS

    The article is right as far as it goes. I think more should be said about Medicaid and Medicare. They are paid for differently and they played a different role in the COVID pandemic.

    MEDICARE: During their employment years, workers pay a tax toward Medicare. In their retirement years, individuals pay Medicare premiums for the insurance coverage; it’s deducted from their social security or they pay out of pocket. There are also co-payments and co-insurance that individuals pay for directly (or else by purchasing gap insurance). Medicare does not fall on general tax revenue to sustain it. Not that it’s cheap, or that it never uses general tax revenues, but it is chiefly sustained by special taxes and premiums.

    MEDICAID: This is co-funded by federal and state general tax revenue; the recipient beneficiaries are poor and do not pay premiums for it. Republicans hate it b/c of that. With the demise of welfare, Medicaid is the last remaining welfare transfer tax, where the wealthy tax payer contributes to covering the needs of the poor. The poor never actually get to spend this money; where it goes is to Federally Qualified Health Centers, rural health centers, and public hospitals in areas where there are high concentration of poor families, disabled persons, and elderly. And it’s often not bad at all, but quite good. Without Medicaid, medical providers would not stay in business to serve those communities at all. Medicaid very efficiently funds childbirth and childhood vaccines. A large expense for Medicaid are persons severely disabled at home or confined to a nursing home. Medicaid disproportionately funds mental and behavioral health because for profit hospitals disproportionately will not.

    COVID Pandemic and MEDICAID: During the covid pandemic, the federal gov. encouraged Medicaid to sign on (or cover) more people. The feds, with congressional approval, sent the states incrementally more Medicaid dollars and the states agreed to admit more people to their state administered Medicaid program. Most states also agreed per their deal with the feds not to qualify Medicaid recipients with means testing during the covid health emergency. These actions passed during the height of the pandemic, because there were massive job lay-offs and many people who lost job related health coverage, besides many sick persons and over-whelmed medical systems/persons that had to be paid. So, in times of travail, letting Medicaid expand helped sustain both the population and the medical systems from collapse. Now, in 2023, with the health emergency officially ended, the federal gov. is snapping back the other way, asking states to winnow people off of Medicaid by rigourous requalification. They have also cut SNAP (food stamps) and are doing debt limit kubuki theater to drive home to the population that they must not rely on assistance programs … at the same time the feds continue to bail out and prop up weak banks and permit capital gains to be taxed at a lessor rate than earned income, so this is how the USA does its power politics and class warfare.

  7. antidlc

    According to the report from Wendell Potter, a former insurance executive who now advocates for systemic healthcare reform, government programs are now the source of roughly 90% of the health plan revenues of Humana, Centene, and Molina.

    Over the past decade, Potter found, the seven top for-profit insurance companies in the U.S.—the three mentioned above plus UnitedHealth, Cigna, CVS/Aetna, and Elevance—have seen their combined revenues from taxpayer-backed programs soar by 500%, reaching $577 billion in 2022 compared to $116.3 billion in 2012.

    “The big insurers now manage most states’ Medicaid programs—and make billions of dollars for shareholders doing so—but most of the insurers have found that selling their privately operated Medicare replacement plans is even more financially rewarding for their shareholders,” Potter wrote. “In addition to their focus on Medicare and Medicaid, the companies also profit from the generous subsidies the government pays insurers to reduce the premiums they charge individuals and families who do not qualify for either Medicare or Medicaid or who work for an employer that does not offer subsidized coverage.”

  8. Paul Art

    One thing that is always verboten is how the Physician community silently colludes with the prevailing unjust system. You will read very little about the AMA (American Medical Association) or how they control the supply of Physicians with an almost stranglehold. If we had a H1-B visa for Physicians and allowed Accenture, Tata Consultancy Services and Cognizant to import Doctors a significant impact can be made on medical costs. On a recent trip to India my wife and I caught Covid. The owner of the AirBnb we were staying at being a Doctor immediately sent another Doctor and Nurse for a home visit. It cost us $30. It is a travesty how the Physians especially Specialty Physicians have completely come to own the Healthcare system in this country. One puzzle is why the insurance giants won’t go to Washington like Bill Gates and Sergei Brin and Larrry Ellison to demand a H1-B visa for Physicians. Note that Doctors from India are eligible for H1-Bs once they are here but companies like TCS and Cognizant are not allowed to import them here like they do Engineers. The Physician lobby is so powerful that they make sure no one with a medical degree from other countries get even a tourist visa to the US. I had a classmate here in the US during my Masters who basically hid his medical degree on his visa application. He had a BS in Biology after which he did medicine. He applied for a MS in Biology, hid his medical degree and came here and then took his ECFMG and passed, applied and got a residency and went on a H1-B. Many Doctors from India marry Engineers here on H1-B visas, come here and take their ECFMG. There are plenty of medical schools in India and they churn out well trained Doctors. There is a true free market.operating there. Tells you a lot about the system here.

  9. orlbucfan

    There’s a load of hot air on here. I’m on traditional Medicare with a FL Blue supplement. I live in Floridumb. I would not give up my trad Medicare for nothing. I also have to maneuver through the PHrMA nightmare, but I do it. I’m retired, just middle class, but not facing bankruptcy. I know how to keep records and do very simple accounting.

  10. Willie

    How long to maintain CMS when FUTA (payroll tax for Medicare/medicaid) takes in just 15% of annual liabilities? This statistic, sourced from Karl Denniger at who has a proposal, that is studiously ignored (it’s been posted here), to bring to heel exponential, negative outcomes. It will never reach fruition, I fear.

    From all appearances, Legislators have no interest in reversing the status quo. No one’s tallied up a poll. It’s evident that the talking points are mired in diversion. A tactic too transparent to ignore. The mantra, in tune with electioneering, serves the concerned if only to perpetuate the norm; where does that benefit spring from, and who receives the spoils? A quid pro quo is evident, historically speaking, as well the lack of progress in sorting out any details not subject to lobbyist’s and oother outside interests, irrelevant of duty or lawful procedure .

    It’s emblematic of every department or service offered in the federal catalog. It denotes capture by a facetious representative agenda opposite of what that mission entails.

    Citing popular proposals is impressive in its eloquence, but access, and sincere consideration, lack evidence of acceptance from any Congressional entity, but for nudging those proponents out the door.

    What local institutions, removed from that shining hill and its influence, is capable of raising popular support across a viable spectrum to force the issue? Then the question remains; will it be in time quell the fall out of decades of real or feigned incompetence?

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