Understanding Medicaid: A Lifeline for Millions
Congress is considering significant changes and cuts to safety-net programs like Medicaid. This blog post is the first in a series that aims to highlight the critical role Medicaid plays in the lives of millions and provide insights into the policy decisions that could impact its accessibility.
Medicaid serves as a critical lifeline for communities, ensuring accessible and affordable health care for over 77.9 million Americans, including 1.3 million Coloradans. Medicaid is a public health insurance program that provides comprehensive coverage of health and long-term care for low-income Americans. It is jointly funded by the federal and state governments but administered by state agencies within broad federal rules. For instance, Colorado receives over 50% of funding for Medicaid from the federal government, including 90% for the Medicaid expansion population. Federal regulations mandate coverage of certain populations and benefits, but states have additional flexibility to shape their programs to meet the unique needs of their residents.
Who Does Medicaid Serve?
As the country’s largest source of health coverage, Medicaid serves all walks of life, including children and families, pregnant people, older adults, individuals with disabilities, and more. Medicaid covers one in five people living in the United States. It remains a key source of coverage for specific populations, covering four in ten children, five in eight nursing residents, 41% of all births, and 44% of individuals with disabilities.
A significant portion of Medicaid enrollees are working individuals and families who don’t earn enough to afford private insurance or are not offered insurance through their jobs. In Colorado, 65% of adults covered by Medicaid are working. All but ten states have decided to implement Medicaid expansion, a provision of the Affordable Care Act (ACA), that expands coverage to adults with incomes up to 138% of the federal poverty level. Medicaid expansion has reduced the uninsured rate in some areas by half.
Medicaid Improves Health Outcomes
Medicaid is associated with improved access to care, better health outcomes, and economic benefits for individuals covered under the program. With a more consistent source of care, individuals are less likely to have unmet health care needs and more likely to use health care services appropriately.
Medicaid has been a key mechanism for advancing health equity and reducing disparities. Expanding Medicaid under the ACA and addressing the coverage gap has been particularly important to communities of color, with over six in ten people in the gap being people of color. Additionally, granting states the flexibility to offer optional benefits — such as housing and nutrition support, continuous eligibility, or postpartum coverage — has empowered states to address health-related social needs. These measures ensure more equitable access to care and services.
Long-standing research shows that Medicaid eligibility during childhood is associated with positive health outcomes, including lower rates of avoidable hospitalizations and mortality. Beyond health, access to Medicaid is also linked to improved educational outcomes in children, which in turn contributes to higher rates of employment and earnings as adults.
Medicaid in Colorado
In Colorado, the Department of Health Care Policy & Financing (HCPF) administers Health First Colorado (Colorado’s Medicaid program), Child Health Plan Plus (CHP+) (Colorado’s Children’s Health Insurance program), and other health care programs. HCPF covers nearly 1.3 million Coloradans, representing one in five residents. These programs play a crucial role in the state’s health care system, ensuring Coloradans have access to affordable, quality care.
Medicaid accounts for one-third of the state budget – $16 billion – nearly 58% of which comes from federal funding. This funding provides critical health care access to Coloradans, stimulates our state and local economies, creates thousands of jobs throughout the state, and ensures that hospitals can provide care to all Coloradans. Any changes to federal Medicaid funding would have a significant impact on the services and care available across the state.
Broad Support for Medicaid
Medicaid has historically had a broad base of support, with nearly 80% of Americans across all political parties viewing the program favorably. An overwhelming 97% of adults recognize Medicaid as an important resource for people in their communities. Recent polling found that just 17% of people are supportive of decreasing Medicaid funding, while 42% believe Medicaid funding should be increased, and 40% want it to stay the same.
Beyond being a cornerstone of our health care system, Medicaid is also deeply personal for many, with 65% saying that they or someone close to them has received assistance from Medicaid at some point in their lives. The program is particularly crucial for rural communities, whose residents are less likely to have access to comprehensive health care. In Colorado, 37% of children and 18% of adults living in rural areas rely on Medicaid for their health insurance compared to 33% of children and 14% of adults in metro areas.
Expanding health care access has long been a shared priority for Colorado legislators. Members from both sides of the aisle have come together to pass policies that expand access to care and coverage, such as HB23-1322 Medicaid Coverage Housing & Nutrition Services and HB23-1300 Continuous Eligibility Medical Coverage. Colorado Access supported both efforts to address health disparities and coverage gaps for Coloradans.
Medicaid is a bedrock of our health care system, providing access to essential services to millions of Americans and Coloradans alike. Potential cuts or changes to Medicaid would have detrimental consequences – not only for the individuals who rely on it but also for state and local economies. As policymakers debate the future of Medicaid, it is essential to recognize its crucial role in promoting health, well-being, and economic stability.