Assessing the Fiscal Impact of Medicaid Expansion in Mississippi

Manatt, Phelps & Phillips, LLP

I. Introduction -

Since 2014, states have had the option to expand Medicaid eligibility to most adults with incomes under 138 percent of the federal poverty level (FPL; approximately $30,300 in annual earnings for a family of three). Under this option, the federal government covers 90 percent of the cost of the new adult eligibility group (also known as the “expansion group”), a significantly higher rate than it covers for most Medicaid populations and services. (Mississippi’s matching rate for most services is 78.31 percent in FY 2022, prior to the application of the temporary 6.2 percentage-point increase available under the Families First Coronavirus Response Act.) In addition to the enhanced federal matching rate for the expansion population, the recently enacted American Rescue Plan Act of 2021 (ARP) provides states that implement expansion after the enactment of ARP with a significant increase in Medicaid funding for most other Medicaid populations. In the following, we estimate the five-year fiscal impact in Mississippi if the State were to expand Medicaid beginning in State Fiscal Year (SFY) 2023, examining projected costs and savings associated with the expansion, including the added funding available through the ARP.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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