By taking a proactive approach to implementing the Affordable Care Act (ACA), Kentucky has achieved dramatic increases in health insurance coverage and made care more accessible and affordable. In 2014, Kentucky expanded Medicaid coverage, established a well-functioning health insurance marketplace, and conducted successful outreach campaigns and enrollment assistance.
However, the sustainability of these gains is uncertain as the state’s newly elected governor has begun to dismantle the “Kynect” marketplace and proposed significant changes to the Medicaid program.
Since the Medicaid expansion took effect in January 2014, enrollment in Kentucky’s Medicaid program has grown by more than 570,000 people.1 Prior to expansion, Medicaid eligibility for parents of dependent children was limited to those with incomes below 57 percent of the federal poverty level (FPL), or roughly $13,850 for a family of four, according to the 2016 poverty guidelines. Adults without dependents who were neither pregnant nor disabled were not eligible for Medicaid, no matter how low their incomes were. The ACA’s 2014 expansion increased the eligibility threshold to 138 percent of FPL for all adults (or approximately $33,500 for a family of four).
To assess the impact of the expansion, we surveyed nearly 3,000 Kentucky residents with incomes below 138 percent of the federal poverty level between 2013 and 2015 as part of a Commonwealth Fund–supported study. We also surveyed a similar number of residents in Texas, which has not expanded Medicaid eligibility and limited outreach and enrollment assistance, and in Arkansas, which used a Medicaid waiver to subsidize premiums for beneficiaries who purchase private health insurance through the marketplace. This post compares survey findings between Kentucky and Texas.
In Kentucky’s first year of Medicaid expansion, the percentage of adults with incomes below 138 percent of poverty who were uninsured dropped from 40.2 percent in 2013 to 23.6 percent in 2014. This reduction was 16.6 percentage points larger than the coverage change in Texas. Relative to Texans, Kentuckians reported having better access to care and receiving more regular care for chronic conditions (see Exhibits 1, 2, and 3). In addition, fewer Kentuckians than Texans reported using the emergency department as their usual source of care in 2014. There were greater than 10 percentage-point decreases in the proportion of Kentuckians who reported skipping a medication because of the cost or had trouble paying medical bills, compared with Texans.2
In addition, nearly 83,000 Kentuckians enrolled in a private insurance plan through Kynect during the 2014 open-enrollment period, and 70 percent of these enrollees received premium tax credits.3 Kynect was successful because of an aggressive outreach campaign, application assistance programs, and an integrated Medicaid and marketplace eligibility determination designed to help people get the insurance they were eligible for, regardless of how they originally applied for coverage.
Compared with Texas, which relied on the federal government to run its marketplace and passed laws restricting the role of navigators and application assisters, low-income survey respondents in Kentucky had more success in obtaining coverage through their state marketplace. People applying for coverage in Kentucky were more likely to receive application assistance, to successfully enroll after beginning an application, and to rate their application experience as good or excellent.4
These gains in health care coverage, access, and affordability hang in the balance as Kentucky’s new governor advances his plans to revise and roll back some ACA policies. Per his campaign promise, Governor Bevin has begun work to move Kentucky to the federal marketplace by 2017—a process that will cost an estimated $23 million.5 This transition will likely involve disbanding most local navigator teams and replacing them with remote support services supplied via the federal marketplace. The federal marketplace does not support an integrated application portal for both Medicaid and subsidized marketplace plans, which has been a hallmark of Kentucky’s streamlined enrollment approach. In addition, insurance costs for consumers may increase as the user fee for the federal marketplace is higher than the Kynect fee.6
Bevin also has proposed overhauling the state’s Medicaid program. He has backed away from a complete reversal of the Medicaid expansion, which would have left at least 400,000 current enrollees without coverage. Now, his administration is pursuing a section 1115 waiver from the U.S. Department of Health and Human Services to restructure its Medicaid program.
The state’s decisions on whether and how to alter the Medicaid program, in addition to the dismantling of Kynect, could have substantial adverse effects on thousands of low-income Kentuckians who have been helped by the law.
1 Centers for Medicare and Medicaid Services, “Medicaid & CHIP: December 2015 Monthly Applications, Eligibility Determinations and Enrollment Report” (CMS, Feb. 2016).
2 B. D. Sommers, R. J. Blendon, and E. J. Orav, “Both the 'Private Option' and Traditional Medicaid Expansions Improved Access to Care for Low-Income Adults, ” Health Affairs, Jan. 2016 35(1):96–105.
3 U.S. Department of Health and Human Services, Office of the Assistant Secretary for Planning and Evaluation, “Addendum to the Health Insurance Marketplace: March Enrollment Report for the Period October 1, 2013–March 1, 2014” (ASPE, March 11, 2014); and U.S. Department of Health and Human Services, Office of the Assistant Secretary for Planning and Evaluation, “Second Addendum to the Health Insurance Marketplace Summary Enrollment Report for the Initial Annual Open Enrollment Period: October 1, 2013–March 31, 2014” (ASPE, May 1, 2014).
4 B. D. Sommers, B. Maylone, K. H. Nguyen et al., “The Impact of State Policies on ACA Applications and Enrollment Among Low-Income Adults in Arkansas, Kentucky, and Texas,” Health Affairs, June 2015 34(6):1010–18.
5 D. Bachrach, P. Boozang, M. Lipson et al., “Manatt on Medicaid: Kentucky Update—Outgoing Governor Beshear Argues for Continuation of Medicaid Expansion and State-Based Marketplace” (Manatt, Nov. 30, 2015).