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What’s at Stake with ACA Repeal?

A repeal of the Affordable Care Act (ACA) is now in motion in Congress and has the potential to impact every state’s Medicaid program and individual health insurance market. The ACA increased health insurance coverage by expanding Medicaid, offering tax credits to low- and middle-income Marketplace enrollees, and reforming insurance market rules around coverage for people with pre-existing conditions. The Republican replacement plan passed by the House of Representatives, the American Health Care Act, would maintain many of these market rules but give states the option to waive certain rules, including the requirement that insurers not charge people with pre-existing conditions higher premiums.  It also would restructure the premium tax credits to be mostly flat (based on age), meaning that low-income individual market enrollees would receive a smaller tax credit and higher-income enrollees would receive a larger tax credit. In addition, the AHCA would roll back the ACA’s Medicaid expansion by phasing out enhanced federal funding for this coverage and would significantly reduce other federal Medicaid funding over time by limiting federal Medicaid financing under a per capita cap or, at state option, a block grant for some enrollees.

The map and tables below highlight the increases in health insurance coverage through Medicaid and the Marketplaces as well as the increased federal funding that resulted from the implementation of the ACA. Table 1 provides data on the number of people whose coverage could be affected by the AHCA as well as the gains in coverage in each state under the ACA.

 Table 1: Medicaid & Marketplace Enrollment

NOTES: Total Medicaid and Medicaid Expansion Enrollees are reported for the quarter January-March 2016. Total Marketplace Enrollees and Enrollees Receiving Advanced Premium Tax Credits represent effectuated enrollment as of February 2017.  Estimates of People with a Declinable Pre-existing Condition are based on data from 2015. Reduction in the Number of Uninsured, 2013-2015 may not match other national estimates due to differences between data sources. * Montana implemented the Medicaid expansion on January 1, 2016 and Louisiana implemented the Medicaid expansion on July 1, 2016.
SOURCE: Kaiser Family Foundation analysis. For more information see State Health Facts: http://kff.org/statedata/ 

Table 2 provides data on federal Medicaid spending in states from January to March 2016 (the most recent data available) as well as the value of tax credits received by Marketplace enrollees. Under current Medicaid rules, states also pay a share of Medicaid costs, with the federal government matching states’ spending on an open-ended basis. The federal share of Medicaid is based on a formula that accounts for state income and is designed so that the federal government pays a larger share of program costs in poorer states. In 2017, the federal share (FMAP) ranged from 50% to 74%. States receive a higher FMAP of 95% in 2017 for the Medicaid expansion population, which phases down to 90% in 2020.  

Table 2: Medicaid & Marketplace Financing

NOTES: Total Federal Medicaid Spending and Total Federal Medicaid Expansion Spending data are reported for Federal Fiscal Year 2015. Estimated Total Annual Premium Tax Credits Received by Marketplace Enrollees are calculated based on data from February 2017.
* Montana implemented the Medicaid expansion on January 1, 2016 and Louisiana implemented the Medicaid expansion on July 1, 2016.
SOURCE: Kaiser Family Foundation analysis. For more information see State Health Facts: http://kff.org/statedata/ 

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Filling the need for trusted information on national health issues, the Kaiser Family Foundation is a nonprofit organization based in Menlo Park, California.