The Implications of a Medicaid Buy-In Proposal

Analysis of legislation introduced in the U.S. Senate that would create a mechanism for states to offer their residents the opportunity to buy a Medicaid-based public insurance option.

What is Medicaid Buy-In?

In August 2017, a new Medicaid buy-in program was proposed for people enrolling in nongroup insurance coverage through the Affordable Care Act (ACA) marketplaces. Given high public support for Medicaid, the intent of the policy is to provide states with an option that, should they take it, would ensure access to affordable marketplace coverage options. In addition, Medicaid buy-in might increase competition in the marketplaces and lead to lower premiums.

Medicaid buy-in could bolster access to affordable care, but challenges exist. The buy-in option would allow eligible residents to use their premium tax credits and reduced cost-sharing requirements would apply as well, to purchase Medicaid-based public insurance plans. However, there would be many differences between a Medicaid buy-in plan and existing Medicaid programs.

Key Findings

States most likely to implement and benefit from a Medicaid buy-in option:

  • Few insurers in the Affordable Care Act (ACA) marketplace,

  • High premiums on the ACA marketplace,

  • Have expanded Medicaid.


Many of the states with low insurer participation and higher premiums in the marketplace are those that have not expanded Medicaid eligibility under the ACA and thus are unlikely to create a buy-in option for middle-income consumers.

About the Urban Institute

The nonprofit Urban Institute is dedicated to elevating the debate on social and economic policy. For nearly five decades, Urban scholars have conducted research and offered evidence-based solutions that improve lives and strengthen communities across a rapidly urbanizing world. Their objective research helps expand opportunities for all, reduce hardship among the most vulnerable, and strengthen the effectiveness of the public sector. Visit the Urban Institute’s Health Policy Center for more information specific to its staff and its recent research.

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