Medical Infrastructure - Medicaid And The Uninsured

Medicaid is the third largest source of health insurance in the United States. In 1978, Medicaid covered 9.1% of the population, in 1998 12.0%. This same year, 18% of the non-elderly population had no health insurance.²⁹ The graph shows the number of persons for whom a Medicaid claim was paid during that year. Most of those served by Medicaid are children (in 1998, 51%).³⁰ 1998 was the first year those served by managed care Medicaid plans³¹ were added to the statistics.

Medicaid was established in 1965 as part of the same legislation that established Medicare. Before the law passed, state and local governments, charities, and community hospitals provided health care for the poor. Starting in 1950, the federal government provided matching funds for state payments to medical providers for individuals receiving public assistance monies. In 1960, the Kerr-Mills Act established a program called "Medical Assistance for the Aged." Federal funds were given to states that covered the "medically needy" elderly: people who did not qualify for public assistance, but needed assistance with medical expenses. The Medicaid program is an extension of the Kerr- Mills Act.

Medicaid provides three types of benefits: (1) health insurance for low-income families with children and the disabled, (2) long-term care for the elderly and disabled, and (3) supplemental coverage for low-income Medicare beneficiaries for services not covered by Medicare.

Each state, under broad federal guidelines, establishes its own eligibility requirements, benefits, payment rates, and program administration for Medicaid. Not all people with low incomes are eligible. However, new eligibility requirements were drafted in the 1980s, and Medicaid program waivers allowed states to extend Medicaid benefits beyond the traditional groups (i.e. aged, blind, disabled, families with children, and pregnant women).

Federal regulations mandate that state Medicaid programs cover certain people and services. Federal regulations also provide options for extending coverage.

But, what about the 43.9 million Americans, in 1998, without health insurance coverage?³² Why aren't they covered under Medicaid? Most are the employed and their dependents.³³ 73% live at or above the federal poverty level of about $16,450 per year for a family of four. 19% of uninsured working families work two or more full-time jobs. And, in 32 states, parents who work full-time for minimum wage ($5.15/hr or about $10,700 a year) are not eligible for Medicaid.

Why can't Medicaid be extended to cover the currently uninsured? In the next panel we'll take a look at Medicaid expenditures.

Sources: Health Care Financing Administration. U.S. Department of Health and Human Services. Chartbook 2000: A Profile of Medicaid, September 2000. Retrieved September 16, 2002 from http://cms.hhs.gov/charts/medicaid/2Tchartbk.pdf. Centers for Medicare and Medicaid Services. "National Summary of Medicaid Managed Care Programs and Enrollment June 30, 2001." Retrieved September 16, 2002 from http://cms.hhs.gov/medicaid/managedcare/trends01.pdf. The Henry J. Kaiser Family Foundation. The Kaiser Commission on Medicaid and the Uninsured. Uninsured in America: Key Facts, March 2000. Available online: http://www.pbs.org/news hour/health/uninsured/kaiserstudy/kaiser_key_facts.pdf.