The Impact of Medicaid Expansion on Uncompensated Care Costs: Early Results and Policy Implications for States

Since implementation of the Affordable Care Act (ACA), more than 10 million people in 30 states (including the District of Columbia) that expanded Medicaid have gained Medicaid or CHIP coverage, and the collective rate of uninsured individuals in expansion states has fallen from 18 percent to less than 11 percent.

This report is the third in a series prepared by the Robert Wood Johnson Foundation’s State Health Reform Assistance Network exploring the fiscal implications of expansion. The first two reports explored state budget savings and revenue gains associated with expansion. This paper examines early data on expansion-related decreases in uncompensated care costs and related state budget implications, including impending reductions in federal support for Medicaid Disproportionate Share (DSH) payments and waiver pools made available to support hospital uncompensated care costs prior to the Medicaid expansion authorized and funded under the ACA.