Congress debates and looks likely to pass a COVID relief bill this month that includes substantial new financial incentives for Medicaid non-expansion states to finally extend health coverage to lower income parents and workers as 39 other states (including DC) have done. States that expand would get two years of increased Medicaid payments based on enrollment in their entire program. This would amount to hundreds of millions of dollars in new funding or, for larger states, billions of dollars of new funding. Not only would the already small 10% state share of costs of expanding Medicaid be completely covered (the federal government currently pays 90%), but states would have extra money to address other important priorities like improving services for people with disabilities, filling state budget holes caused by the pandemic, or building up critical state public health systems.
If the federal bill passes in its current form, states can expand any time after the date the legislation is signed into law to take advantage of this new federal money. In most states this will require action by the state legislature. There are a few caveats to the state legislative action requirement. In Alabama the Governor can decide herself to increase Medicaid eligibility, a decision made easier if there is a positive budget impact. Voters have already passed initiatives requiring Oklahoma and Missouri to expand – in these states policymakers are debating the form of implementation but will still get the federal incentive funding once they start their expansions.
Legislatures have to be in session for legislative action to happen. To expand this year during their regular sessions, action will have to happen by session end dates coupled with Governors signing the legislation into law. Below is a chart with session end dates for 2021. While these dates are important, keep in mind that some legislatures can also enact law in extra “special sessions” outside of this date range although this would be less likely and depend on state politics and practice. And even if states don’t act to expand this year, the huge federal incentive payments remain available into the future without a current end date. Finally, should a state like Mississippi, South Dakota or Florida decide to expand through a voter-initiated and passed ballot measure that occurs outside the legislative process, the state would also receive federal incentive money once the expansion is implemented.
Medicaid Non-Expansion States: Legislative Session End Dates
|2021 Session End Date
|Oklahoma [Expanded, but not implemented – funding is being debated]
|Missouri [Expanded, but not implemented – funding is being debated]