Kentucky's Medicaid Expansion Has Paid Off, Study Finds

More than 375,000 Kentuckians signed up for the state’s expanded Medicaid program in 2014, and doing so has saved Kentucky approximately $100 million, according to a report from Deloitte Consulting LLC and the University of Louisville’s Urban Studies Institute.

The report was commissioned by the state’s Cabinet for Health and Family Services (CHFS) and reviewed the first full year of Medicaid expansion. Individuals and families who qualified for Medicaid through the expansion sought healthcare at a 55% higher rate compared with existing Medicaid enrollees.

“For all the naysayers who claimed that expanding Medicaid was a budget-busting boondoggle, take a look at the facts,” Gov Steve Beshear said in a statement. “It’s working, and it’s literally paying off. The state is saving money, hospitals are earning more, and our people are getting healthier.”

The state’s uninsured population dropped significantly since the start of the Affordable Care Act from 20.4% in 2013 to 11.9% in the middle of 2014.

Gov Beshear added that not expanding Medicaid would have lost the state money and job growth. The expansion will generate a net positive impact of nearly $820 million to the state and local government budgets, and it is expected to add 40,000 jobs and $30 billion to the state’s economy through 2021.

Providers, hospitals, and pharmacies are seeing the benefits, too. The CHFS estimated that Medicaid expansion added $1.16 billion in new revenues to healthcare providers last year. Hospitals not only reduced uncompensated care costs but received more than $506 million in revenue. Uncompensated care visits were down 55% over the first 3 quarters of 2014 compared with the same time in 2013.

“Bottom line, we made the right choice for Kentucky when we expanded Medicaid,” said Gov. Beshear. “I’m excited about the enormous gains we’re seeing already, and even more excited about the long-term implications for our state’s health.”