Medicaid gives people access to essential health care and supports when they need it most, but enormous Republican-proposed cuts would jeopardize the health of over 70 million people, including children, pregnant people, older adults, people with disabilities and people with low incomes. Throughout the spring, the National Partnership for Women & Families highlighted the importance of Medicaid in the lives of our staff and their loved ones, proudly proclaiming Medicaid Matters. Medicaid helped our colleague Natasha to get extra care during her high risk pregnancy, our colleague Lorena to receive oral health care and reproductive care and helped TJ and Maria maintain their economic security and care for their families. Medicaid allows Dr. Albert Coombs III to provide dental care to his patients everyday, and allows Mandy to maintain her independence and autonomy. As we look ahead to the 60th anniversary of the Social Security Amendments on July 30, 2025, more commonly known as the Medicare and Medicaid Act, we reflect on the importance of this program to people nationwide. Medicaid Matters for You. Medicaid Matters for All of Us.
With health care costs rising across the country access to comprehensive and affordable health coverage is more crucial than ever. Medicaid is one of the largest and most cost-efficient health insurance programs in the United States and provides critical care to millions of enrollees everyday. Medicaid enrollees are more likely to have complex medical and social needs, and without access to Medicaid many of these enrollees would forgo care altogether. An estimated $700 billion dollars is expected to be cut from Medicaid in the next ten years, representing the largest cut in the program’s 60 year history and causing over 8 million coverage losses. Attacks on Medicaid funding, coverage, or the program’s structure will jeopardize the health and economic security of individuals across the country whether they are a Medicaid enrollee or not.
Medicaid is a crucial component of the United States health care ecosystem and everyone benefits from the program’s existence. Medicaid covers almost twenty percent of all health care spending, and around one-fifth of all hospital care spending. Hospitals and providers across the country rely on Medicaid funding to remain open. This is especially true in rural areas where more people rely on Medicaid health coverage than their urban counterparts. In some states like Louisiana, New Mexico and South Carolina, Medicaid provides health coverage to over 50 percent of children in rural areas. Additionally, while Medicaid finances over 40 percent of births nationwide, it plays an even larger role in rural communities, financing nearly half of all births in these areas.
Currently over one-third of rural hospitals are at risk of closing and nearly half of all rural hospitals already operate with negative margins. Reductions in Medicaid payments or the number of Medicaid enrollees in an area will have serious impacts on hospitals’ financial stability forcing them to close their doors entirely, eliminate essential services, or postpone equipment upgrades. Hospital closures in rural communities have the potential to devastate local economies by eliminating dozens of jobs, increasing the unemployment rate and decreasing per capita income in an area. Even if hospitals do not close entirely, financial constraints will force them to make decisions on what types of services they will be able to offer—maternity care is particularly vulnerable. From 2006 to 2020, over 400 hospitals have closed their maternity wards. The closure of maternity wards exacerbates health disparities and increases maternal mortality and morbidity. Closing maternity wards means longer travel times for pregnant patients, reduced access to perinatal health care and increased rates of birth interventions such as inductions and C-sections. Access to Medicaid funding is vital to keeping labor and delivery units open and combating the growing maternal mortality crisis.
In addition to Medicaid’s role in keeping hospitals afloat, it is also crucial to the health and autonomy of older adults and people with disabilities. Medicaid is the primary payer for home and community based services, which allow people to receive long term care in their homes rather than institutions. Medicaid covers over two-thirds of home care spending and supports the jobs of over four million direct care workers. The direct care workforce (nursing assistant, personal care aides, and home health aides) is disproportionately made up of women, particularly women of color. Due to the systematic devaluing of care work, many of these direct care workers rely on Medicaid not only to finance their jobs, but also as a source of health coverage. An estimated 70 percent of people who reach the age of 65 will need long term care at some point in their lives and Medicaid plays a critical role in funding these supports. Medicaid cuts have the potential to devastate the long-term care industry and exacerbate the current direct care workforce shortage.
Medicaid is more than just a health coverage program, it is also a huge contributor to state and local economies and the U.S. health care industry at large. Medicaid supports employment in the health care sector, generates state and local tax revenue, and spurs economic growth by allowing enrollees to save money on health care costs that can be spent elsewhere. Access to Medicaid also decreases the amount of uncompensated care hospitals provide, thus helping keep health insurance premiums low for those with private health coverage. A 2016 study found that when states began expanding Medicaid, hospitals saved an average of $2.8 million annually on costs related to uncompensated care. Proposals to cut Medicaid will decimate state and local economies and increase insurance premiums for those with private insurance.
Medicaid Matters to everyone whether you receive your health coverage through the program or not. Cuts to Medicaid harm us all and worsen unemployment rates, increase rates of uncompensated health care, contribute to the closure of hospitals and exacerbate the direct care workforce shortage. Sixty years after the passage of the Medicaid Act, access to this health coverage is more important than ever. Huge Republican-proposed Medicaid cuts will leave everyone with worse health care access and higher insurance rates. If we truly want to make America healthy we must protect this essential program at all costs.
Read more from the Medicaid Matters series:
