The ACA’s 65th Birthday Challenge: Moving from Medicaid to Medicare

Abstract

The Affordable Care Act (ACA) expanded Medicaid to millions of low-income near-elderly Americans, facilitating access to health care services, but did not change income eligibility for Medicaid for those 65 years and older. Therefore, following the ACA’s coverage expansion, many newly-insured older enrollees will face a complex insurance transition on their 65th birthday: they will lose Medicaid coverage and transition from Medicaid to Medicare as their primary insurer. This transition in primary health insurance coverage includes changes to benefits, patient cost-sharing, and provider reimbursement, which could have profound consequences on the use of health services and associated health outcomes for low-income seniors. Using data from 2012, we estimate that 1.6 million current Medicaid beneficiaries and an additional 1.6 to 2.9 million low-income individuals who will gain Medicaid coverage under the ACA will be likely to make this transition in the next decade. Primary care physicians and policymakers can help mitigate the potential consequences of this insurance transition by preparing patients for Medicare’s more restrictive insurance coverage, encouraging patients to sign up for available low-income subsidies, and understanding how the loss of Medicaid coverage impacts out-of-pocket costs.