The ACA and Medicaid Expansion Waivers

(Source – Kaiser Family Foundation)

Under the Affordable Care Act (ACA), Medicaid plays a key role in efforts to reduce the number of uninsured by expanding eligibility to nearly all low income adults with incomes at or below 138% of the federal poverty level (FPL, $16,242 per year for an individual in 2015) with full federal financing for the first three years, gradually decreasing to 90% federal funding; however, the Supreme Court ruling on the ACA’s constitutionality effectively made the expansion a state option. According to CMS guidance, states cannot receive the enhanced federal funding for the ACA expansion unless they cover all newly eligible adults through 138% FPL; enrollment caps also are not permitted. As of November 2015, 31 states including DC have adopted the expansion, and nearly all are implementing the expansion as set forth by the law. A limited number of states have obtained or are seeking approval through Section 1115 waivers to implement the expansion in ways that extend beyond the flexibility provided by the law.  In some cases, alternative models to implement expansion through waivers are seen  as a politically viable way to extend coverage and capture enhanced federal matching funds for newly eligible adults. This brief provides an overview of the role of Section 1115 waivers in expanding coverage since the enactment of the ACA and highlights key themes in these waivers as well as highlights provisions that CMS has turned down. Read more…

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