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An Evaluation of the Impact of Medicaid Expansion in New Hampshire: Phase II

January 2013

New Hampshire Department of Health & Human Services (DHSS)
Lewin contact: Randy Haught

As a result of the June 2012 Supreme Court ruling that the federal government cannot require individual states to expand their Medicaid programs for adults under the Affordable Care Act (ACA), The Lewin Group is working with the New Hampshire Department of Health and Human Services (DHHS) to explore the potential financial impacts of expanding or not expanding the state’s Medicaid program.

Phase I of the study, released in November 2012, analyzes Medicaid enrollment and costs under the option of not expanding Medicaid compared to the option of expanding the program under various program design options. We find that if the state does not expand Medicaid, it could reduce state Medicaid spending by $66 to $114 million over the 2014-2020 period. However, expanding Medicaid would (1) reduce the number of uninsured in the state by an additional 22,300 people, (2) provide subsidized coverage for low income adults in the state, who would not have access without the expansion, and (3) increase federal revenues in the state by $1.8 to $2.7 billion over the 2014-2020 period.       

This report represents Phase II of the study, where we estimate the secondary effects of expanding versus not expanding Medicaid in the state. We estimate the impact of Medicaid expansion versus no expansion on other state programs, the uninsured, various provider groups, the state economy, and the commercial market. Here, we find that deciding to expand or not expand Medicaid in New Hampshire will have impacts beyond the state’s Medicaid program itself. If expanding Medicaid under a fee-for-service program, the state will see offsets (savings) to other state programs totaling $67.1 million from 2014 to 2020, reducing the total cost of expanding Medicaid to $18.4 million over this period. If expanding Medicaid under a managed care program, the state would save $47.1 million from 2014 to 2020, compared to projected costs without the ACA.

Phase II findings also indicate that the ACA will have a measurable, positive impact on the state economy at large, and expanding Medicaid will maximize this impact. The impact on the uninsured, on providers, and on the commercial market should also be considered, as the decision to expand Medicaid affects these stakeholders and subgroups in different ways.

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