As Medicaid ‘unwinding’ continues and more states expand eligibility, U-M report provides key insights

August 25, 2023
Concept illustration of healthcare in Michigan. Image courtesy: U-M Institute for Healthcare Policy and Innovation

At a pivotal time for Medicaid health coverage for Americans with low incomes, a report on the impacts of Michigan’s Medicaid expansion shows very positive effects, as well as opportunities for continued improvements.

The report was produced by the University of Michigan Institute for Healthcare Policy and Innovation as part of its evaluation of the Healthy Michigan Plan, Michigan’s Medicaid expansion program. The program currently has about 1 million enrollees and was signed into law 10 years ago this September.

On the whole, the report shows that the Healthy Michigan Plan has been effective at:

  • Reducing the number of uninsured individuals
  • Supporting financial well-being
  • Promoting primary care and responsible use of health care services among people with low incomes
  • Sustaining the safety net and supporting coordinated strategies to address social determinants of health

The report also draws on data and interviews to show that two unique aspects of Michigan’s expansion—financial incentives for participants to focus on healthy behaviors and income-based cost-sharing to foster personal responsibility around health care decisions—were only partially effective at achieving their aims.

U-M’s Institute for Healthcare Policy and Innovation’s evaluation is funded by the Michigan Department of Health and Human Services and is required by the federal Centers for Medicare and Medicaid Services as part of Michigan’s Medicaid expansion waiver. This was the interim report released midway through the waiver period.

The findings have implications far beyond Michigan, the IHPI evaluation team says.

Currently, all states are in the process of “unwinding” the special Medicaid continuous-enrollment provision that was put in place during the height of the Public Health Emergency during the COVID-19 pandemic.

Since April, more than 5.3 million people have lost Medicaid coverage in the 45 states and District of Columbia that have reported data as of Aug. 23. Redeterminations, as they are called, of individual eligibility will continue into 2024.

Michigan has launched an online dashboard to track redetermination data, including the number of individuals whose Medicaid is not being renewed. MDHHS recently provided an update on the process and efforts to reach participants who need to provide information to determine their eligibility.

Measuring the impacts of the unwinding on individuals, health systems and safety net agencies will be important, especially in light of the positive impacts of expansion coverage, the authors of the IHPI report say.

At the same time, several states that did not adopt Medicaid expansion in the first six years of the program through 2019 have done so in the last few years (see full list of current state policies).

About 1.9 million adults with potentially qualifying low incomes live in the 10 states that have not expanded Medicaid under the federal program

“Since 2014, the Healthy Michigan Plan has increased access to care and was associated with improved health and other outcomes reported by beneficiaries, many of whom were previously uninsured or unconnected to social support services that can impact health,” said John Ayanian, director of IHPI and leader of the HMP evaluation project.

During the COVID-19 pandemic, the Healthy Michigan Plan maintained access to coverage and care for those already enrolled and offered coverage for new beneficiaries affected by unemployment and loss of health insurance, Ayanian said.

“We hope our findings will inform other states as they go through the process of redetermination, consider partial or full expansion of Medicaid, or consider implementing specific features into their Medicaid programs such as cost-sharing provisions or healthy behavior incentives,” he said.

A recently enacted Michigan law modifies some of the income-based cost-sharing requirements of the Healthy Michigan Plan, which the report finds have not fully achieved their aim and which the IHPI team had recommended simplifying in its report. The new law made other updates to the program, too.

The Healthy Michigan Plan is open to Michigan residents ages 19 to 64 who earn an income at or below 138% of the federal poverty level—as of 2022, $18,754 for an individual or $36,908 for a family of four.

The program began covering Michiganders in 2014 and now covers about 1 in 10 people living in the state. In all, about 1 in 4 Michiganders have some form of Medicaid or Children’s Health Insurance Program coverage.