Obamacare’s Medicaid Expansion Does Less Than It Claims

I am still playing whack-a-mole with journalists and others who keep confusing Medicaid with health insurance. The latest is the coverage of the Urban Institute’s latest Health Reform Monitoring Survey. The Hill reported it as” “Uninsured rate falls by half in states that expanded Medicaid”.

Imagine if a state expanded cash welfare payments versus its neighbors. The media would report that the number of people reporting no cash income had dropped faster in that state, despite creating no jobs.

This issue of the Health Reform Monitoring Survey tells pretty much the same story as the one this blog discussed last July: Obamacare is mostly an expansion of welfare dependency.

But wait a minute…

According to the report (page 3):

The uninsurance rate in states that expanded Medicaid by March 2015 fell by more than half (52.5 percent), from 15.8 percent to 7.5 percent. In states that did not expand Medicaid, the uninsurance rate fell from 20.7 percent to 14.4 percent, a decline of 30.6 percent.

This is the change from Q4 2013 (the beginning of Obamacare’s first open enrolment) to Q1 2015. However, it is expressed in relative terms. If we look at absolute change, the rate dropped 8.3 percentage points in Medicaid expansion states and 6.3 percentage points in states that did not expand Medicaid – a much smaller difference.

The dramatic difference between relative and absolute changes is because Medicaid expansion states had more “insured” than before the expansion. (More of those so-called “insured” were likely on Medicaid before the expansion, too.) So, the same absolute change looks a lot better when expressed in relative terms.

Even if you wrongfully define Medicaid as health insurance, the expansion achieved a lot less than its supporters assert.

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