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Private insurance spending increased in non-expansion states, Health Affairs finds

Most of that reflects the significant increase in private insurance enrollment during that period, which was greater in those states.

Jeff Lagasse, Associate Editor

Private health insurance spending grew more rapidly in states that did not expand Medicaid eligibility in 2014, according to new research published in Health Affairs. When Medicaid expansion kicked in as part of the Affordable Care Act, private insurance spending rates increased 6.8 percent in non-expansion states, compared to 4.6 percent in expansion states.

Most of that reflects the significant increase in private insurance enrollment during that period, which was greater in non-expansion states -- 3.2 percent, compared to 1.9 percent for expansion states. That more rapid growth was caused, in part, by enrollment in marketplace plans.

The study looked at per capita spending by state and per-enrollee spending for the three largest payers -- Medicare, Medicaid and private insurance -- through 2014, providing a window into some of the first-year effects of the ACA's big-ticket overhauls. Researchers also examined the effects of the modest recovery from the economic recession. Data was drawn primarily from The State Health Expenditure Accounts produced by the Centers for Medicare and Medicaid Services' Office of the Actuary.

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The ACA and economic recovery had a larger impact on insurance spending than on per capita personal healthcare spending, which saw state rankings stay more or less the same: personal spending ranged from $5,982 in Utah to $11,064 in Alaska, nearly twice as much. Spending in Alaska was 38 percent higher than the national average of $8,045, while Utah came in at 26 percent lower.

New England, the Mideast, the Great Lakes region and the Plains regions tended to have higher personal spending on healthcare overall. States with higher personal income per capita, greater percentages of Medicare and Medicaid enrollees and more health care capacity tend to have relatively higher levels of personal heathcare spending, and that trend has remained largely the same for the last several years.

Most states saw some acceleration in personal healthcare spending growth in 2013 and 2014, partly because of the coverage expansions through Medicaid and the marketplaces. But the growth rates for this spending in expansion and non-expansion states was similar, at 4.4 and 4.5 percent, respectively.

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The recession, which ended in 2009, and the subsequent recovery had a much larger effect on personal healthcare spending, according to the study. From 2010 to 2013, it grew at a rate of 2.8 percent pr year, on average -- compared to the average of 5.2 percent per year from 2004-2009.

Medicare was the least affected by coverage expansions and the economy. This, researchers said, was primarily due to the program's universal coverage based on eligibility requirements.

Twitter: @JELagasse

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