Changes in Insurance Coverage Among Hospitalized Nonelderly Adults After Medicaid Expansion in Michigan

Expanded insurance coverage through the Affordable Care Act (ACA) may reduce the burden of uncompensated care for hospitals. Recent reports have indicated that rates of uninsurance among hospitalized adults have declined as coverage expanded in 2014.^1-4 However, no peer-reviewed publications have assessed statewide trends in coverage with ACA-sponsored expansion and also examined between-hospital differences in coverage trends.

Michigan expanded Medicaid coverage in 2014 under the ACA.⁵ We compared insurance coverage for hospitalized patients during initial implementation of the Healthy Michigan Plan in April-December 2014 with corresponding months in 2012 and 2013. We also examined patterns at the level of individual hospitals to ascertain whether the consequences of expanded coverage were uniform across institutions.

The Michigan Inpatient Database is compiled by the Michigan Health and Hospitals Association from a complete census of discharge data reported by acute care hospitals in Michigan. In this study, the “uninsured” coverage category included discharges listing the primary payer as “self-pay” or “no charge.” Analyses of payer categories (uninsured, Medicaid, Medicare, private, other) were performed for adults aged 18 through 64 years to correspond with coverage expansion provisions for nonelderly adults sponsored by the ACA. Discharges with missing payer status (<0.2% in all years) were excluded. The University of Michigan Medical School institutional review board declared this study of deidentified data as not regulated for human subjects review.

Among 130 hospitals in Michigan that provide acute care, 454 658 discharges occurred for nonelderly adults in April-December 2012, 443 861 in April-December 2013 (2-year mean, 449 260), and 445 161 in April-December 2014.

In April-December, uninsured patients represented 5.8% in 2012 and 6.0% in 2013 of nonelderly adult discharges compared with 2.0% in 2014 (Table). The proportion of discharges for nonelderly adults with Medicaid increased from 22.9% in 2012 and 23.8% in 2013 to 29.9% in 2014. The changes in proportions of discharges with private coverage and Medicare over the same period were smaller. Most of the changes in the proportions of uninsured and Medicaid discharges occurred in the first quarter of Medicaid expansion and remained stable for the rest of 2014 (quarters 1, 2, 3, 4: uninsured, 5.7%, 2.4%, 2.0%, 1.8%; Medicaid, 25.5%, 29.4%, 30.1%, 30.0%).

In 94% of Michigan’s acute care hospitals, the proportion of discharges for uninsured patients was lower in 2014 compared with the mean proportion of uninsured discharges for 2012 and 2013 (Figure). Conversely, in 88% of those hospitals, the proportion of discharges for Medicaid patients in 2014 exceeded the mean proportion of discharges with Medicaid for 2012 and 2013.

With implementation of the Healthy Michigan Plan, the proportion of uninsured discharges among nonelderly adults decreased and the proportion with Medicaid increased, similar to reports from other states that have expanded Medicaid through the ACA.^1-4 The reductions in uninsured patients occurred without an increase in the number of hospitalized nonelderly adults, suggesting opportunities to reduce uncompensated care. Changes in insurance patterns occurred within the first 3 months of coverage availability, similar to other states² and suggesting benefits of Michigan’s efforts to engage new beneficiaries in primary care soon after enrollment.⁵

The analysis extends prior analyses of ACA-sponsored coverage expansion in 2 aspects. First, we characterized statewide hospital trends (rather than trends in individual hospitals or hospital corporations) across multiple coverage categories. Understanding shifts in insurance patterns are important for hospitals’ support for coverage expansion under the ACA.

Second, the statewide analysis indicates how uniformly the changes in coverage were experienced by the hospitals over time. If policy changes affect hospitals asymmetrically, key state-level stakeholder groups (such as hospital associations) may find it difficult to maintain support for major policy initiatives (such as coverage expansion).

Potential limitations of this study include that it focused on 1 state, the source data do not distinguish Medicaid expansion from pre-ACA forms of Medicaid coverage, and it only includes hospital claims within the first year after Medicaid expansion. In the future, it will be essential to characterize how decreases in uninsured hospitalizations under the ACA are associated with changes in uncompensated care for hospitals.

Corresponding Author: Matthew Davis, MD, MAPP, Institute for Healthcare Policy and Innovation, University of Michigan, 300 NIB, 6A18, Ann Arbor, MI 48109-5456 (mattdav@med.umich.edu).

Author Contributions: Dr Davis and Mr Gebremariam had full access to all of the data in the study and take responsibility for the integrity of the data and the accuracy of the data analysis.

Study concept and design: Davis, Ayanian.

Acquisition, analysis, or interpretation of data: All authors.

Drafting of the manuscript: Davis.

Critical revision of the manuscript for important intellectual content: All authors.

Statistical analysis: Davis, Gebremariam.

Conflict of Interest Disclosures: All authors have completed and submitted the ICMJE Form for Disclosure of Potential Conflicts of Interest. Drs Davis and Ayanian are supported by a contract from the Michigan Department of Health and Human Services to the University of Michigan to conduct an evaluation of the Healthy Michigan Plan that does not include the current study. No other disclosures were reported.

Disclaimer: The views in this article are those of the authors and do not represent official positions of the Michigan Department of Health and Human Services.