How is the Medicaid Expansion funded during the initial three years?

During the initial three years of Medicaid Expansion under the Affordable Care Act (ACA), the costs are funded 100% by the federal government. This provision was designed to incentivize states to expand their Medicaid programs by removing financial barriers. The federal government aimed to increase access to healthcare for low-income individuals by fully covering the costs of newly eligible enrollees for this period.

By offering complete funding during the first three years, the ACA encouraged states to participate in the expansion, significantly increasing the number of individuals who could access health insurance. After the initial three years, the federal contribution gradually decreases, but it starts at 100% to foster immediate enrollment in the Medicaid program among eligible populations.