Expansion of Medicaid

Seniors and the Law is authored by the attorneys at JacksonWhite Attorneys at Law and addresses legal issues that arise for the elderly and their families.  Questions can be sent to firm@jacksonwhitelaw.com.
Q:        I have read about Governor Brewer’s decision to expand Medicaid under the Affordable Care Act.  I understand that state legislators are trying to bring a lawsuit in an effort to undo Arizona’s expansion of Medicaid.  Can you explain what would happen if Arizona did not expand Medicaid?
The Affordable Care Act was not drafted to give states an option as to whether they would expand Medicaid.  Rather, after a challenge to the law, the Supreme Court upheld most of its provisions, but determined that states could decide whether or not to participate in the Medicaid expansion.  An unintended consequence of this process is that States which reject the expansion create a disjointed healthcare coverage system.
Under the Affordable Care Act, individuals who earn between 139% and 400% of the Federal Poverty Limit can get subsidized insurance on the health insurance exchange.  Further, for states that opt to expand Medicaid under the ACA, everybody who earns 138% of the Federal Poverty Limit or less are eligible for Medicaid coverage.  The effect of this in states that expand Medicaid is that the government provides health insurance for those who earn up to 138% of the FPL, and then subsidizes insurance for those who earn between 139%-400% of the FPL.
The subsidies are applicable nationwide, but the problem for states that do not expand Medicaid is that there are many people who earn less than 138% of the FPL, but more than the state’s Medicaid limit.  The average Medicaid income requirement in states that do not expand Medicaid is about 46% of the FPL, meaning that people in the “average” state who earn between 46%-138% of the FPL would not get any assistance, while higher earners earning between 139%-400% of the FPL could purchase subsidized insurance on the exchange.  If Arizona were to rescind its expansion, we would be subject to this inequity.
             Richard White is an elder law attorney at JacksonWhite Attorneys at Law.  For more information on Elder Law at JacksonWhite, please visit www.ArizonaSeniorLaw.com.
This article is provided for informational purposes only and is not intended to replace individual legal advice.