HR3590 Health Care Bill & Government Health Insurance

Health care reform and its goal of ensuring health care coverage most – if not all – Americans will entail the expansion of Medicaid, the state-run health insurance program for the poor. A feature on Stateline.org shares how the expansion of Medicaid will work.

States are supposed to place the level of Medicaid eligibility to 133 percent of the federal poverty level. To those states that are already generous as it is in terms of its Medicaid programs, this will not be that big of a change. Among the states that already set their eligibility cut-off point above that level are Connecticut, Maine and New York.

This does not mean, however, that these states will not have additional costs; while they may not spend as much on expansion itself, they will need to shell out money for the projected increase in enrollment.

For those that do not, however, the expansion of Medicaid will have its associated costs. Long story short, in order to ensure coverage for more people, these states will have to spend more.

The health care law, according to the feature, has taken this fact into consideration and has come up with a financing scheme to help states that will need to spend more on Medicaid moving forward. From the year 2014 to 2016, the federal government will take care of expansion related costs. This aid will then taper off to the federal government paying for 10 percent by year 2020. The amount of federal aid will depend on how generous the state already is; those that are already generous as it is will start out with lower federal aid.