Issue Alert | October 2012

Healthcare Reform: Exchanges and the Expansion of Medicaid

On June 28, the United States Supreme Court ruled that most of the requirements laid out by the Patient Protection and Affordable Care Act (ACA) were Constitutional, including the requirement for states to either establish health insurance exchanges by 2014 or have the federal government do so. Also, while the Supreme Court ruled that the federal government could not tie all Medicaid funding to a mandatory expansion, states have the opportunity to increase eligibility levels with an associated federal matching percentage, which will diminish through 2020, when the matching percentage will stabilize at 90 percent. Decisions on implementing a health insurance exchange and expanding Medicaid will be the top public health priorities for states in the upcoming year. States will play a huge role in the implementation of the ACA, and these complicated decisions undoubtedly will have a major impact on state budgets, businesses and individual citizens.This Issue Alert from the Southern Legislative Conference provides an overview of the choices and potential consequences of state decisions.