The Affordable Care Act will have important impacts on state Medicaid programs, likely increasing participation among populations that are currently eligible but not enrolled.
The size of this “welcome-mat” effect is of concern for two reasons:
Using the Massachusetts 2006 health reforms as a case study and controlling for other factors, the researchers found that among low-income parents who were previously eligible for Medicaid in Massachusetts, Medicaid enrollment increased by 16.3 percentage points, and Medicaid participation by those without private coverage increased by 19.4 percentage points, in comparison to a group of control states.
In many states the potential size of the welcome-mat effect could be even larger than what we observed in Massachusetts. Their analysis has potentially important implications for other states attempting to predict the impact of this effect on their budgets.