Michigan's Medicaid expansion leads to lower uninsured rates, improved health, and cost savings

This article is part of State of Health, a series about how Michigan communities are rising to address health challenges. It is made possible with funding from the Michigan Health Endowment Fund.

Since the state of Michigan created the Healthy Michigan Plan in 2014, expanding Medicaid coverage to all households with incomes up to 133% of the federal poverty level, the number of uninsured Michiganders has plummeted by 53%. Now, with the University of Michigan's (U-M) help, the state is looking back to examine how that change has improved health for Michigan residents who otherwise could not afford health insurance.

The Michigan Department of Health and Human Services (MDHHS) enlisted the U-M Institute for Healthcare Policy and Innovation (IHPI) to study the impacts of the Healthy Michigan Plan. Created under the Affordable Care Act, the Healthy Michigan Plan is a type of Medicaid coverage managed by MDHHS that offers health insurance coverage to Michigan residents, ages 19-64 with income at or below 133% of the federal poverty level, who do not qualify for Medicare or other Medicaid programs. That means, for the past seven years, a family of four earning approximately $36,500 or less could access health insurance via Medicaid or the Healthy Michigan Plan. By July 2020, 749,547 Michigan residents were enrolled in the Healthy Michigan Plan.
Dr. Susan Goold and Dr. Renuka Tipirneni have been working on the University of Michigan's evaluation of Michigan's Medicaid expansion.
IHPI's work found that as a result of the expansion, more Michiganders are receiving primary and preventive health care, more successfully managing their chronic conditions, and seeking care from their own health care homes rather than emergency rooms and walk-in urgent care clinics.
Brian Keisling.
"In terms of what Healthy Michigan Plan enrollees reported back to University of Michigan when they've been surveyed, they've experienced detection of chronic conditions and have been able to get treatment for those," says Brian Keisling, director of the Bureau of Medicaid Operations and Actuarial Services for the MDHHS Michigan Medicaid Program. "They've also, in terms of their own perception, seen improvement in their health status and in their treatment of chronic conditions."

Michiganders of all races and ethnicities responding to IHPI surveys say their health has improved and they now have access to regular care through a doctor's office. These improvements were most notable among income-challenged residents.

"Seeing improved health in a population over time usually takes years and years, not like two or three," says Dr. Susan Goold, professor of internal medicine and health management and policy at U-M and author of a recent study on the expansion's impact. "Just to see the health improvements in the Medicaid population in the space of a couple years is impressive."

Before they were enrolled in the Healthy Michigan Plan, 49% of the study participants had a regular doctor's office, 25% had no regular source of medical care, and 23% reported using walk-in care and emergency rooms when they needed care. Black and Latino respondents were more likely to use walk-in care, while white and Arab-American/Chaldean respondents were more likely to lack any regular source of care. By 2018, 83% of Healthy Michigan Plan enrollees said they had established a medical care home.

"Michigan really emphasized primary care and the use of preventive services," Goold says. "If you can imagine being a low-income person, the last thing you want to pay for is a colonoscopy. Low-income people usually only go to the doctor when they are sick."  
Dr. Susan Goold.
As far as overall health status, the overall percentage of respondents reporting fair or poor health fell from 30% in 2016 to 25% in 2018. However, Latinx respondents' numbers dropped even more, from 30% to 18%; as well as Black respondents', which dropped from 33% to 25%. 

"When we talk about health equity, we are seeking ways to ensure everyone has what they need to access health care and well-being in general terms. With Medicaid expansion, we see an increase in preventive care, in important health screenings," says Amber Bellazaire, health policy analyst with the Michigan League for Public Policy (MLPP). "No doubt the Healthy Michigan Plan has had a role in increasing health equity. Coverage alone isn't going to eliminate all disparities we see, but it is absolutely a critical factor."

While the experts can only guess how the COVID-19 pandemic would have impacted almost a million Michiganders who would not have had health insurance without the Healthy Michigan Plan, most likely outcomes would have been even more grim. The number of residents enrolled in the program grew from 650,000 to 900,000 during the pandemic.

Amber Bellazaire."For some, the pandemic meant a decrease in income because of job loss. Those adults who lost their employer-sponsored coverage did not become uninsured but rather had the Healthy Michigan Plan to turn to when they needed it," Bellazaire says. "Also, Medicaid couldn't disenroll people during the emergency. That was really helpful so folks enrolled did not have to worry about changes to their coverage or manage renewal processes during the height of the pandemic."

Leaders at the state level, especially those heading MDHHS programs, have been thrilled with the positive impacts Medicaid expansion has had in Michigan.

"It goes a long way to really decreasing the number of overall uninsured individuals that are out there," Keisling says. "Prior to Medicaid expansion, historically, we've had about 1.2 million people that didn't have insurance. The Healthy Michigan Plan is really taking that number down considerably."

Keisling says more people are utilizing primary care and controlling chronic conditions before they become worse and more expensive.

"They're able to see their primary care doctor and others, as needed, to help manage those and not let them get out of control," Keisling says. "And certainly, this improves financial health for individuals because we know they don't have to actively spend out what resources they have to get health coverage for themselves."

When income-challenged people don't end up in the ER or hospitalized, hospitals save money, too. There is no net projected cost for the state over the next 21 years — while saving a projected $320 million in uncompensated care costs by 2022 alone. Federal funds covered 100% of the cost from 2014 to 2016, 95% in 2017, 94% in 2018, 93% in 2019 and 90% in 2020 and beyond. While the state covers those costs unmet by federal dollars, Michigan's Medicaid expansion has also added about 30,000 new jobs, increased residents' personal income by $2.3 billion, and saved the state $235 million in 2016 alone because the federal Medicaid funds covered some prison health care costs.

"Our evaluation of the Medicaid expansion overall has found lots of benefits for the state, not just for Medicaid enrollees but for hospitals. Uncompensated care went down, especially in rural areas, and that can be really important," Goold says. "People with health insurance are more likely to be employed. It doesn't just help the enrollees. It helps lots of other people: those who are taking care of them, the health care providers, and their caregivers. Medicaid expansion has been a real plus for the state."

A freelance writer and editor, Estelle Slootmaker is happiest writing about social justice, wellness, and the arts. She is development news editor for Rapid Growth Media and chairs The Tree Amigos, City of Wyoming Tree Commission. Her finest accomplishment is her five amazing adult children. You can contact Estelle at [email protected] or www.constellations.biz.

All photos by Doug Coombe.