VA Medicaid Expansion Lowered Member Financial Concerns During COVID-19

Virginia Medicaid beneficiaries experienced fewer financial concerns during the coronavirus pandemic due to Medicaid expansion, according to self-reported data published by Health Affairs.

“Our findings add insight into the financial protection of public insurance during a public health crisis,” the researchers explained. “We found that newly eligible enrollees reported decreased worry about paying for housing, food, monthly bills, and minimum payments on loan and credit card bills one year after enrollment in Virginia’s expanded Medicaid program.”

The researchers collected paper survey responses between December 2018 and April 2019 related to beneficiaries’ experiences in the year before they enrolled in Medicaid through Medicaid expansion. They followed up with these beneficiaries between July 2020 and May 2021 to study their experiences a year after enrolling in Medicaid.

The initial paper survey received over 1,500 responses and the follow-up survey received more than 1,600 responses.

Respondents were primarily non-Hispanic White, female, nonrural residents and mostly reported good, very good, or excellent physical and mental health. Nearly half were single and were educated beyond high school.

After adjustment, concerns about medical costs and medical debts shrank significantly among Medicaid beneficiaries who had been enrolled in Medicaid expansion for a year when compared to the prevalence of concerns before Medicaid expansion. 

The frequency of beneficiaries experiencing challenges in paying medical bills dropped by 44.6 percentage points. The share of those who struggled with paying off their medical debts declined 18.5 percentage points.

The prevalence of concerns about the costs of normal healthcare dropped 33.7 percentage points and concerns about catastrophic care costs were 23.9 percentage points less common after Medicaid expansion enrollment.

After adjustment, a year of Medicaid expansion enrollment was associated with lower nonmedical financial concerns. Two of the nonmedical financial concerns that saw the biggest decreases were apprehensions about food costs and minimum amounts on loans or credit cards, which each saw decreases of 7.7 and 7.8 percentage points, respectively, after Medicaid expansion.

The likelihood that beneficiaries were concerned about paying monthly bills dropped by 6.4 percentage points in the year after enrollment in Medicaid expansion compared to before Medicaid expansion. The likelihood that beneficiaries would have anxiety about housing costs declined by 5.0 percentage points after Medicaid expansion.

Medicaid expansion was also associated with advancements in health equity. Non-Hispanic Black and African American beneficiaries saw bigger decreases in financial barriers than non-Hispanic White members in certain areas, particularly in normal healthcare costs. Additionally, rural residents saw bigger decreases in fiscal concerns when compared to nonrural beneficiaries.

While the study focused on only one state and relied on self-reported data, which can be less reliable, the researchers argued that the results effectively highlight how public health insurance impacts Americans’ fiscal wellbeing during a crisis.

Virginia expanded its Medicaid program in January 2019, a year before the coronavirus pandemic struck the US.

Following its initial adoption of Medicaid expansion, Virginia has continued to expand eligibility for the public payer program. In 2021, the state extended postpartum Medicaid coverage for new mothers, enabling around 6,000 new mothers to retain health insurance during the postpartum period.

Separate research suggests that total Medicaid expansion could lead to improved health equity and uninsurance rates if the 12 states that have not expanded their Medicaid programs did so.

The first year after Medicaid expansion could lead to significant changes in the characteristics of a state’s Medicaid population, another study found. Some elements of member experience may decline during that time period. However, the study indicated that member experience typically rebounds after the first year.