Expanded Medicaid leaves fewer Nebraskans without health coverage

The two years since Nebraska expanded Medicaid to cover more low-income people have changed life in the state.

Emerging data shows that the number of state residents without health coverage has plunged, hospitals are feeling less stress on their bottom lines and fewer people are filing for bankruptcy.

Sen. Adam Morfeld of Lincoln said those results bear out what advocates argued during six years of failed efforts to win legislative approval of expansion and, later, during the successful campaign to pass a Medicaid expansion ballot initative.

"The data only affirms what we promised Nebraskans: that our family members, neighbors and friends would be more healthy, financially secure and lead longer and happier lives," he said. "This also reduces the burdens on rural hospitals that often struggle to stay open and increases access and reduces health care costs for all Nebraskans."

Morfeld led the petition drive that put the Medicaid expansion measure on the 2018 general election ballot. Advocates took the issue to voters after two governors, Dave Heineman and Pete Ricketts, along with state lawmakers, repeatedly blocked legislation.

Even after the ballot measure passed, the Ricketts administration took nearly two years to implement the program, the longest delay of any state. Coverage began Oct. 1, 2020, although it took another year for all enrollees to get the full array of Medicaid benefits.

Since the expansion began:

* The number of Nebraskans without health insurance has dropped 14.5%.

* Nebraska hospitals saw a $20 million reduction in the amount of charity or unpaid care they had to write off.

* Bankruptcy filings in the state fell by 23.5%.

Sarah Maresh, health care access program director for Nebraska Appleseed, a key group pushing for expansion, said the Nebraska numbers are similar to those seen in previous expansion states. To date, 38 states plus the District of Columbia have expanded their Medicaid programs as allowed under the federal Affordable Care Act.

"We're just really excited to see this come to fruition," she said. "The health of our state depends on the health of individuals."

The governor did not respond to a question about whether Nebraska was better for having expanded Medicaid. His staff offered the following statement:

"Gov. Ricketts' team at the Nebraska Department of Health and Human Services has worked hard to effectively roll out Medicaid expansion to Nebraska, per the will of the people."

The state's battle over Medicaid expansion played out over a decade and has been highly contentious and partisan, largely driven by disagreements over former President Barack Obama's controversial 2010 health care law.

That law, the Affordable Care Act, was intended to reduce the ranks of the uninsured, particularly by helping the millions of Americans who work in jobs that neither provide health insurance nor offer wages high enough for them to afford insurance on their own.

For people above poverty level who lacked coverage, the ACA offered subsidies to help them buy private insurance through health care exchanges.

For lower-income people, the law called for expanding Medicaid, the joint state-federal health care program for the poor. But a U.S. Supreme Court case made Medicaid expansion voluntary for states. That sparked the years of struggle in Nebraska and many other Republican-dominated states.

Through the expansion program, Nebraska has extended coverage to single adults and couples without minor children — neither of whom could qualify for Medicaid previously, no matter their incomes. Also included are parents and disabled people with incomes higher than the previous Medicaid cutoff for those groups.

The income cutoff for Medicaid expansion is 138% of the federal poverty level, currently $18,754 annually for a single person or $38,295 for a family of four.

New U.S. Census Bureau data show one key result of expansion: The percentage of Nebraskans who lacked health insurance dropped from 8.3% in 2019, before expansion, to 7.1% in 2021.

That 14.5% reduction represented the most significant drop in more than a decade in the proportion of Nebraskans without health coverage. The only similar figure was the 14.2% drop between 2013 and 2014, when the ACA health insurance marketplace was launched.

Combined, the insurance marketplace and Medicaid expansion account for most of the 37% drop in uninsured Nebraskans between 2013 and 2021.

Nebraska's reduction following Medicaid expansion was the eighth-biggest drop among all states for 2021. Maine, which approved Medicaid expansion at the ballot box a year before Nebraska did, saw the biggest reduction at 29%.

The latest uninsured figures, based on monthly census household surveys, likely do not capture the full impact Medicaid expansion will ultimately have on Nebraska's uninsured population.

Reports from the Nebraska Department of Health and Human Services show that the number of people enrolled for expansion continues to grow each month. At the end of 2021, the total was 60,720. As of July this year, 71,060 people had signed up for expansion coverage.

Care for those enrollees cost nearly $1 billion from October 2020 through July this year. The federal government covered 90% of the cost, or $868 million, with $106 million coming from state coffers.

Estimates initially said that 90,000 or more Nebraskans could enroll in expanded Medicaid. Maresh said she expects the state will get closer to that level as more people learn about the program.

States like Iowa that implemented expansion when the federal government first made funding available in 2014 tend to have much lower uninsured rates. Iowa's 2021 uninsured rate of 4.8% was nearly one-third below Nebraska's.

Nebraska's expansion also affected two economic health measures, one for hospitals and one for families and individuals.

The Nebraska Hospital Association collected information showing that hospitals across the state wrote off $737 million in charity and unpaid care during 2020, the latest year available. That was down from the $757 million total in 2019 and the $749 million total in 2018.

Jeremy Nordquist, the association president, said the reduction occurred even though hospitals typically lose money caring for Medicaid patients because of low payment rates.

"It was good to get people the ability to access care," he said. "On the whole, it's a small net positive right now."

Nebraskans' personal economic health appears to have improved as well following Medicaid expansion. Records maintained by federal bankruptcy courts show that bankruptcy filings in Nebraska dropped faster than filings nationally after expansion began.

The number of Nebraska filings fell 23.5% during the year ending June 2022, compared with the previous 12 months. Nationally, there were 17.7% fewer filings in that period.

The Nebraska reduction was the largest in a decade and one of only three times since 2013 that state filings declined by a greater percentage than the national ones.

Now that the state has implemented Medicaid expansion, the state ranks 24th-lowest, or best, for its rate of uninsured people. In 2013, the state ranked 18th-best. But at the time of the Medicaid expansion vote in 2018, as other states adopted Medicaid expansion and Nebraska resisted, the state had fallen to 29th-best.

In the 12 states that still have not expanded Medicaid, the uninsured rate of 12.8% is almost double the 6.8% rate in expansion states. Excluding states like Nebraska that only recently adopted Medicaid expansion, the expansion state average is 6.5%.

Nebraska isn't the only state where voters stepped in to expand Medicaid when lawmakers declined to act. Maine was the first to do so in 2017, followed by Nebraska, Idaho and Utah in 2018 and Oklahoma and Missouri in 2020.

In November, South Dakota voters will decide whether to become the 39th state to adopt expansion.