How Medicaid Expansion Could Save Employers Money

Are your workers eligible for Medicaid?

Medicaid Expansion, under The Affordable Care Act (ACA), provides states with additional federal funding for expanding their programs to cover adults with incomes at or below 138 percent of the poverty line. Historically, Medicaid excluded many low-income adults, only covering low-income children, pregnant women, elderly and disabled individuals. The expansion, which is optional for all states, makes millions of more people eligible for free or reduced health care. As of January 2016, 32 states, including the District of Columbia, have adopted the Medicaid Expansion decision₁.

So, as an employer, why should you care about Medicaid Expansion?

Quality Coverage for Workers

Critics often believe that Medicaid offers poor insurance coverage. However, there have been many studies that show otherwise.  Employees who enroll in Medicaid have comparable, if not better and more affordable coverage to employer-sponsored insurance.  In fact, research from the Kaiser Foundation showed that individuals with Medicaid have near identical rates of access to care as people with employer-sponsored coverage₂. And with Medicaid Expansion, more of your employees will be eligible for low-cost, quality health insurance.

Reduce Health Care Costs

Under the ACA, employers who do not offer health insurance for their workers face major penalties. But providing all full-time or full-time-equivalent workers with coverage can get expensive—in some cases, costing companies over $5,000 per employee₃. However, with the expansion of Medicaid, many low-wage workers become eligible for low-cost health insurance through the government. Thus, employers can avoid paying insurance premiums or facing ACA penalties.

In the past, employers rarely promoted Medicaid to their employees—mainly because many of their workers were not even eligible. However, if your company operates in a state with Medicaid Expansion, you could save your company money and get your workers the insurance coverage they deserve.

Contact EPAY to learn how we can help you identify your Medicaid-eligible employees and develop a strategy to help your workers access affordable health insurance alternatives.

Resources

1. http://kff.org/health-reform/slide/current-status-of-the-medicaid-expansion-decision/
2. https://kaiserfamilyfoundation.files.wordpress.com/2013/05/8440-what-difference-does-medicaid-make2.pdf
3. http://www.shrm.org/hrdisciplines/benefits/articles/pages/aca-costs-employers.aspx