The Effect of ACA's Medicaid Expansion on Demand for VA Care
The Affordable Care Act (ACA) could improve access to care for Veterans, particularly if its Medicaid expansion is implemented; however, only about half of the states committed to expanding their Medicaid programs in 2014, and more than half of uninsured Veterans who could qualify for Medicaid did not live in states that expanded their programs. Because Medicaid-financed care serves as an alternative to VA care for low-income Veterans, the choice by states to decline expansion could increase reliance on VA care among Veterans in those states, potentially increasing wait times. This study examined the historical relationships between policy-driven Medicaid expansion and VA enrollment and utilization of inpatient and outpatient care. Using VA and other public data, this study focused on Veterans younger than 65 years of age, and thus not eligible for Medicare. Investigators used variation in Medicaid eligibility thresholds across different states in 2002-2008 to model how changes in Medicaid eligibility affect Veteran enrollment. They then used that model to predict how changes in Medicaid eligibility under the ACA would affect VA enrollment. Investigators calculated a measure of Medicaid eligibility sensitive to policy changes by state and year, but not sensitive to changes in patient demographics or economic conditions.
- If the ACA's Medicaid expansion had been implemented in all states – and holding all else constant – VA enrollment, inpatient days, and outpatient clinic visits would have been 9%, 6%, and 12% lower, respectively.
- For states in which Medicaid did not expand in 2014, VA enrollment, inpatient days, and outpatient clinic visits were 10, 6, and 13 percentage points higher, respectively, than they would have been otherwise; this higher demand may have contributed to longer wait times.
- These results suggest that Medicaid expansion could reduce the burden of demand placed on VA medical centers. As policymakers continue to address VA capacity issues, the authors suggest they be mindful of the potential role of Medicaid – and that it may change over time if more states adopt the expansion.
- This study is based on data that were available only through 2008.
- Investigators were unable to simulate the effects of the ACA's individual coverage or employer mandate and other features, i.e., the establishment of subsidized exchange coverage.
This study was partly funded by HSR&D. All authors are part of Health Care Financing & Economics (HCFE) and the VA Boston Healthcare System, Boston campus.
Frakt A, Hanchate A, and Pizer S. The Effect of Medicaid Expansions on Demand for Care from the Veterans Health Administration. Healthcare: The Journal of Delivery Science and Innovation. March 12, 2015;e-pub ahead of print.