NCPA - National Center for Policy Analysis

Federal Government Shares Responsibility for Medicaid Enrollment Decline

October 16, 2000

For the first time in almost a decade, Medicaid enrollment for children and their parents began to decline in 1996. The declines were closely associated with the 1996 welfare reform policies that have dramatically reduced welfare rolls.

Previously, families who received welfare assistance automatically received Medicaid as well, but the 1996 reforms "delinked" the two forms of aid. Recently, Medicaid has expanded by allowing states to create CHIP programs (Children's Health Insurance Program), yet many eligible children and their parents have not enrolled.

With Gore attacking Bush's record on Medicaid enrollment in Texas, whose fault is it? According to the New Republic, Texas is simply an example of what's happening in other states.

  • From 1995 to 1998, monthly Medicaid enrollment declined 12 percent in California, 18 percent in Florida and 29 percent in Wisconsin.
  • Even Minnesota, with one of the most expansive Medicaid programs among states, reported only a modest increase (1 percent) over this period.

The Clinton-Gore administration anticipated the problem with delinking, but has been slow to address them and thus shares any blame the states may have, says the New Republic. The primary problem is that reducing welfare rolls and increasing Medicaid enrollment are at cross-purposes. Furthermore, applying for the programs separately is a bigger bureaucratic hassle and the public misunderstands each programs' eligibility requirements.

Congress set aside $500 million in matching funds to help states address the delinking problems, but states haven't availed themselves of the funds. As of March 2000 only 30 percent of the money had been spent, and five states had not claimed a single dollar of their allocations, likely because the federal government has been less-than-clear in its instructions to local officials on how the money can be spent. It was not until April 7, 2000 that the Clinton-Gore administration finally urged the states to start spending their allotments.

Sources: Katie Isenberg, "Missing Link," New Republic, September 25, 2000, and Marilyn Ellwood (Mathmatica Policy Institute), "The Medicaid Eligibility Maze: Coverage Expands, but Enrollment Problems Persist; Findings from a Five-State Study," December 1999, Urban Institute and Kaiser Commission on Medicaid and the Uninsured, Urban Institute, 2100 M Street, N.W., Washington, D.C. 20037, (202) 833-7200.


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