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Medicaid Expansions: Opportunity for Making Work Pay and Work Choices

June 10, 2009

A new report by the Iowa Policy Project (IPP)  found that increasing access to health insurance can actually lead to higher incomes and employment. In fact, the report found that by raising income eligibility limits for Medicaid, recipients could see increased income of between $791 and $1,050 a year in Iowa — as much as $95.4 million additional income statewide, and additional tax revenue of as much as $5.8 million.  This report  is especially timely in the context of the current debates over health reform at the state and national level.

Click on the link below to read the full 23-page report:
A Healthier Iowa Labor Market Medicaid Expansions and the Impact On Incomes and Work Choices

To read the Executive summary, click here

Other findings by the report include:

  • 70 percent of the uninsured in Iowa worked all or part of the year in 2007, and because of income-eligibility restrictions and other rules, that work may hinder their ability to get health coverage through Medicaid. For example, low-income, working adults who have lost their employer-provided coverage or who cannot afford health coverage are frequently ineligible.
  • While the report found that research is inconclusive on the extent to which low-income workers avoid slightly better-paying jobs that may block eligibility for public health benefits, researchers said that threat is one disincentive for advancement, along with child care access, education and transportation issues.
  • The economic security of Iowa families is closely related to access to health care, and raising income eligibility limits for adults can mean that more Iowans are able to go to work and earn more when they are not constrained by the limits of the current health care system

The report urges policymakers to:

  • Expand Iowa’s Medicaid program to cover all adults with incomes below 150 percent of the federal poverty level.
  • Provide federal matching funds for states to expand eligibility beyond current federal minimums, particularly with regard to low-income adults.
  • Remove categorical eligibility criteria for Medicaid and set minimum federal eligibility standards based on income alone.

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