Medicaid Expansion Reduces Emergency Care, Lowers Costs, and Sustains Rural Health Care Providers – But Gains Are at Risk
Medicaid provides coverage and access to care for many Montanans with serious health conditions
Bozeman, Mont. – A new report by the Montana Healthcare Foundation finds that the HELP Act — or “Medicaid expansion” — is not only covering Montanans with low incomes, but it is also shifting how they use the health care system, lowering costs, and sustaining rural health care services that entire communities depend on.
New findings show Medicaid expansion is a source of coverage for Montanans with serious health needs. The program covers more than 32,500 Montanans with at least one serious illness (such as cancer, cardiovascular disease, or diabetes), and it covers roughly 16,500 Montanans with a serious mental illness or substance use disorder.
The report also shows that, over time, enrollees rely less on emergency departments and more on preventive and primary care. At the same time, Medicaid reimbursement has allowed rural critical access hospitals to grow specialty services — benefits that extend beyond Medicaid enrollees to all community members.
The longer someone stays enrolled in Medicaid, the more their care patterns shift — away from the emergency room and toward the kind of primary and preventive care that keeps people healthier and health care costs lower. As work requirements begin being implemented in 2027, Montana has the opportunity to set an example for the country by sparing as many people as possible from losing health care coverage.
Dr. Aaron Wernham,
Montana Healthcare Foundation CEO
Key findings from Medicaid in Montana: How Medicaid Impacts Montana’s State Budget, Economy, and Health, produced by Manatt Health, show:
Medicaid expansion is keeping people out of the emergency room and saving money.
- Uninterrupted enrollment is reducing costly emergency room use. Among 18,872 low-income adults enrolled in Medicaid expansion for at least three years, at least one emergency room visit was recorded in the first year of enrollment. By their third year, emergency room visits among that same group dropped to 16,833 — a decline of 10.8%.
- Emergency and inpatient costs fall the longer individuals are enrolled in Medicaid expansion. Emergency costs decreased by 28%, and inpatient costs fell by 16% among members enrolled for at least three years.
- Emergency room visits for preventable dental conditions dropped sharply. Emergency room visits for dental conditions treatable in outpatient settings declined by 27% among members enrolled for at least three years.
- As a result, per-member costs have remained nearly flat despite inflation. Average per-member costs rose only slightly — from $11,767 in Year 1 to $11,886 in Year 3 — even as inflation averaged 3.1% over the assessed period.
Medicaid is the financial backbone of health care in rural Montana
- Medicaid expansion dramatically reduced the burden of uncompensated care on Montana hospitals. Hospital uncompensated care costs fell from $390 million in 2015 to a low of $179 million in 2017 following expansion and remained below $250 million until 2023.
- Rural critical access hospitals used Medicaid revenue to grow specialty services, such as orthopedic surgery, dermatology, and behavioral health care. These services benefit entire communities, not only Medicaid enrollees. For example:
- The number of members who had orthopedic surgery at critical access hospitals grew from 700 in 2015 to more than 1,700 in 2024.
- The number of claims for behavioral health services at federally qualified health centers and rural health clinics increased more than six times since 2015, to 52,600 in 2024.
However, an early warning sign is emerging. Medicaid enrollment declined in 2023-2024 as states redetermined eligibility following the end of the COVID-19 public health emergency, and changes in the health care marketplace have also left more Montanans uninsured. At the same time, uncompensated care at critical access hospitals jumped 40% from 2023 to 2024 — rising from $15 million to $21 million. If policy changes drive further disenrollment, rural hospitals may be forced to absorb costs that threaten their long-term financial stability.
Montana Medicaid is the state’s health benefits program that provides insurance to eligible children and adults with low income. In 2015, the Montana State Legislature expanded Medicaid to cover adults ages 18–64 with incomes up to 133% of the federal poverty level through the bipartisan HELP Act.
