Proposals to End Medicaid Expansions Threaten Support to Address the Opioid Crisis

WASHINGTON, DC (July 27, 2017) A new analysis by researchers at Milken Institute School of Public Health (Milken Institute SPH) at the George Washington University concludes that Medicaid expansions are helping states cope with the rising toll taken by the opioid crisis. It also suggests that Congressional proposals to end the Medicaid expansion program may undermine efforts to address this growing public health problem.

Leighton Ku, PhD, MPH, Director of the Center for Health Policy Research and Naomi Seiler, JD, Associate Research Professor of Health Policy and Management at Milken Institute SPH, looked at newly released data from four Southern States (West Virginia, Virginia, Kentucky and North Carolina)—all of which have experienced rapid increases in emergency room (ER) visits and hospital admissions due to the opioid crisis.

They found that Medicaid has covered much of the surge in ER visits and hospital admissions related to the opioid crisis in the two expansion states (West Virginia and Kentucky). In contrast, in the two states that did not expand Medicaid (Virginia and North Carolina), hospitals must cope with high uncompensated care costs related to life-saving treatment for overdoses and other drug-related emergencies.

For example, after West Virginia’s 2014 Medicaid expansion, the percent of drug-related hospital stays covered by Medicaid nearly doubled, climbing to over 60 percent in just one year. At the same time, the share of opioid-related hospital visits by uninsured patients plummeted to 3 percent—thus reducing the hospitals’ burden of uncompensated care.

In contrast, Virginia showed no change in coverage patterns, and hospitals there struggled to keep up with the growing toll taken by addiction. At the same time, the hospitals in this non-expansion state were shouldering rising uncompensated care costs—due to the large number of uninsured patients, including those addicted to opioids, including heroin as well as prescription painkillers.

In West Virginia, the additional Medicaid revenue helps keep hospitals, including those in isolated underserved areas, solvent—and thus able to reduce some of the toll taken by opioids and other drugs, which affects not just people who are addicted but children, families and entire communities.

The analysis also compared Kentucky, which expanded Medicaid, to nearby North Carolina—which did not. Just as in the earlier comparison, the authors found that in Kentucky, the share of drug-related hospital visits grew sharply, but hospitals also got the relief of lowered uncompensated care costs. North Carolina hospitals experienced no such relief, the report notes.

Ku and Seiler say that similar patterns play out when comparing other states with serious substance-use-related health crises such as Ohio, which has expanded Medicaid, and Maine, which has not.

“Beyond covering the initial ER visit or hospital admission, Medicaid coverage can play a significant role helping people addicted to opioids get care needed, including rehabilitation, outside the hospital,” the authors say. The authors also point out that the Affordable Care Act’s Medicaid expansion program provides a lifeline for many communities struggling as the opioid crisis continues to expand.

The analysis also says that Congressional proposals to end Medicaid expansions would threaten the bottom line of many hospitals and other providers. If such hospitals close, people addicted to drugs—and others in the community seeking health care for heart attacks and other life-threatening problems— could be placed at risk.

The analysis, “Medicaid Expansions Help States Cope with the Opioid Epidemic,” can be accessed here.