Forecast for states on Medicaid expansion.

• Author: King, Martha

The federal health reform law is expected to add about 16 million people to the Medicaid rolls. How will states fare under the expansion? The answer depends on many factors: a state's current Medicaid eligibility levels, the number of poor and uninsured people, forthcoming federal regulations, how the economy is doing and even who you ask.

A few things are clear. The federal law prohibits states from reducing their Medicaid eligibility levels in place on March 23, 2010, until 2014. That's when health insurance exchanges must be operating and state Medicaid programs must begin covering people with family incomes up to 133 percent of the federal poverty guidelines ($29,326 for a family of four in 2010). The federal government will cover the lion's share of the medical costs for the newly eligible people, beginning with 100 percent for the first three years (2014-2016) and phasing down to 90 percent in 2020 and beyond. The federal share--referred to as federal medical assistance percentages or FMAP--is also called the federal matching rate.

Although states already are required to cover pregnant women and children in families with incomes up to 133 percent of the poverty level, their coverage of parents of children enrolled in Medicaid or the Children's Health Insurance Program varies greatly. Typically, childless adults do not qualify for Medicaid no matter how poor they are, unless they are disabled or old. A few states have covered some childless adults for some services, either through a federal Medicaid waiver or by using only state money.

This wide variation in current eligibility criteria will most affect how individual states fare financially under the new law. For example, 12 states--Alabama, Kansas, Louisiana, Mississippi, Missouri, New Hampshire, North Carolina, Pennsylvania, Texas, Utah, Virginia and West Virginia--currently provide full benefits for parents with incomes that fall somewhere below 50 percent of the poverty level. Under heath care reform, a greater proportion of poor people in those states will qualify for Medicaid and the enhanced federal match.

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On the high end of current Medicaid coverage for parents, 18 states--Arkansas, Connecticut, Hawaii, Idaho, Illinois, Indiana, Iowa, Maine, Massachusetts, Minnesota, Nevada, New Mexico, New York, Oklahoma, Oregon, Rhode Island, Vermont and Wisconsin--and the District of Columbia already cover at least some parents with incomes at or even above the 133...