Obamacare Is Poised for a Midterm Booster Shot

(Bloomberg Opinion) -- Health spending accounts for 18 percent of U.S. GDP, and disagreements about government’s role in paying for these costs and ensuring coverage have become major issues on the campaign trail this year. Decisions made by voters in the midterm election could have a significant impact on the status quo. 

The biggest battleground, as usual, is Obamacare, but with a twist. Until now, individual health exchanges have drawn the most attention. But after several tough years marked by drama, lawsuits, and sabotage by the Trump administration — and with insurers finally sticking around instead of fleeing and more moderate premium increases — that market finally seems to be stabilizing. Barring an unexpected GOP surge in the midterms, that trend is likely to continue. The real potential for change this year comes instead from the Affordable Care Act’s quieter half, its expansion of Medicaid to cover a larger subset of low-income Americans. 

If things go well for Democrats in November as many expect — with congressional wins providing momentum down ticket and on statewide ballots — that will set the stage for Medicaid expansion to, well, expand. The chance that more states will embrace the program offers a much more concrete and likely way toward greater health coverage than a near-term exchange resurgence, let alone Medicare For All, which won’t be a serious policy possibility until at least 2020.

Obamacare Is Poised for a Midterm Booster Shot

Already, Medicaid enrollment in expansion states has grown by 13.7 million since 2013, and that’s with a number of large conservative states refusing to accept federal funds and cover more people. By contrast, 11.8 million people were enrolled in individual exchange plans at the end of the 2018 open enrollment period, and that number could decline further with the end of the individual mandate. 

Medicaid expansion is explicitly on the ballot in Utah and Idaho, and may be in Nebraska as well. It is more quietly so in Maine, where governor Paul LePage is refusing to implement a Medicaid expansion his constituents voted for last year. The Democratic candidate vying to replace him would start the expansion right away, while the Republican candidate is not a fan of the program. With Virginia already set to expand Medicaid next year, we could have five more expansion states in the next couple of years.

The expansion is also sticky: Once a state has expanded health coverage to thousands of vulnerable people and the federal money starts flowing, it’s very hard to undo it. 

In the 11 states that have yet to expand Medicaid and won’t vote on it this year, shifts in statehouse control could put it back on the table. That includes a high proportion of states — most notably Texas and Florida — that have large numbers of uninsured people.

Obamacare Is Poised for a Midterm Booster Shot

Medicaid expansion also benefits the individual market, according to several studies. Yes, it siphons off patients. But those tend to be particularly low-income and unhealthy populations, so expansion can lead to a better risk pool and more stability.

There are plenty of things that could hold Medicaid back. There’s no guarantee that the referendums will succeed. A good election for Democrats would only be a small step on a very long journey toward the holy grail of expansion in Texas or Florida. And expansion states have enacted or are attempting to enact rules that will eat at enrollment — Arkansas, for one, just kicked more than 4,500 people off of its Medicaid rolls for failing to comply with a work requirement. 

But despite these efforts, there’s a real path for more Americans to gain health care, and it runs through Medicaid, via the ballot box.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Max Nisen is a Bloomberg Opinion columnist covering biotech, pharma and health care. He previously wrote about management and corporate strategy for Quartz and Business Insider.

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