Welfare Leavers and Medicaid Dynamics: Five States in 1995. Did Medicaid Enrollment Decline?

04/14/2000

Consistent with the national pattern, all five study states experienced a decline in Medicaid enrollment for children and adults during 1995, although the extent of the decline varied (Table 3). New Jersey’s Medicaid enrollment in December was only 0.8 percent below its January level, compared to a 4.2 difference in Florida by year end. The other three states had declines of 2.1 to 3.8 percent.

TABLE 3
DISTRIBUTION BY ELIGIBILITY GROUP OF MEDICAID ENROLLMENT
FOR STUDY STATES, JANUARY AND DECEMBER 1995
  States
  Alabama Arkansas California Florida Michigan New Jersey
 
Enrollment in Jan.1995            
AFDC 126,730 69,617 2,690,191 702,315 612,443 326,007
Poverty-related 142,368 52,908 80,685 258,731 100,091 67,562
Medically Needy   10,747 697,860 18,668 74,545 3,086
Other 30,057 14,557 643,006 167,244 64,257 88,404
Total 299,155 147,829 4,110,742 1,146,958 851,336 485,059
 
Enrollment in Dec.1995            
AFDC 113,595 61,413 2,651,487 649,143 537,089 303,281
Poverty-related 146,907 53,254 99,109 261,568 123,502 71,076
Medically Needy   9,549 680,356 17,973 76,619 2,594
Other 28,936 13,759 592,085 170,399 82,117 104,174
Total 289,438 137,975 4,023,037 1,099,083 819,327 481,125
 
Percent Difference            
AFDC -10.4 -11.8 -1.4 -7.6 -12.3 -7.0
Poverty-related 3.2 0.7 22.8 1.1 23.4 5.2
Medically Needy   -11.1 -2.5 -3.7 2.8 -15.9
Other -3.7 -5.5 -7.9 1.9 27.8 17.8
Total -3.2 -6.7 -2.1 -4.2 -3.8 -0.8
 
Children -2.0 -5.2 -0.5 -2.3 -3.0 -0.7
Adults -11.7 -14.8 -5.6 -9.6 -8.4 -2.2
Source:  1995 State Medicaid Research File data.

The level of Medicaid decline attributable to reduced AFDC enrollment was fairly consistent with the level of decline reported by each state’s welfare program (shown in Table 1).(3) Helping offset the welfare declines in every state were increases in the poverty-related groups, although the extent of the increase varied. The increase in poverty-related coverage was only 3.2 percent in Alabama, but this lower rate occurred in part because the poverty-related group already accounted for nearly half the state’s Medicaid enrollees at the beginning of the year. At the other extreme, poverty-related coverage increased by almost 23 percent during 1995 in California, but it still accounted for only 2.4 percent of overall enrollment at year’s end. Michigan also had a high growth rate (23.4 percent) for poverty-related coverage during the year. By year’s end, the poverty-related groups accounted for 15.1 percent of Medicaid enrollment in Michigan. Alabama and Florida, which had the lowest AFDC benefit levels and no or marginal medically needy coverage among the study states, had the lowest rates of increase for poverty-related coverage, but they were making greater use of the poverty-related coverage at the start of 1995 than the other three states.

There were no clear changes in enrollment patterns across the states for persons covered under either the medically needy group or the residual “other” eligibility group. Michigan was the only state with growth in medically needy enrollment during 1995. Michigan and New Jersey reported sizable increases in enrollment under the other coverage group (27.8 percent and 17.8 percent, respectively). This residual coverage group includes families qualifying for transitional assistance. California’s 7.9 percent decrease in enrollment under the other coverage group occurred because of a decline during the year in the number of families affected under a class-action court decision.4

In all five states, the drop in adult Medicaid enrollment during 1995 was greater than that reported for children. This pattern was expected, since adults in all the states had fewer options for noncash coverage than children.