Many Needy Losing Medicaid, Study Finds

By Associated Press, 6/20/2000

WASHINGTON - Changing the welfare laws has been trumpeted as a success because caseloads were slashed and people were pushed into jobs. At the same time, however, close to a million needy parents lost Medicaid coverage in the process, says a group advocating more federal health insurance for the needy.

A study by Washington-based Families USA analyzed Medicaid enrollment in 15 states from 1996 to 1999 and found that 945,880 adults with children were dropped from the program, a decline of 27 percent.

The findings suggest that the massive 1996 overhaul of the nation's welfare system, which aimed to make families more self-sufficient, probably contributed to another national problem that hits needy people hardest - a lack of health insurance. Nationwide, 44 million people are uninsured, 3 million more than in 1996.

More than 2.5 million were enrolled in Medicaid in the 15 states at the end of last year.

The study, released yesterday, attributed the problem to states, contending they mismanaged the implementation of welfare changes. For instance, they were supposed to end the link between welfare enrollment and Medicaid eligibility, but didn't; so many people who left the rolls were routinely dropped from Medicaid, even if they remained eligible.

Many states set income eligibility requirements so low that parents who work at minimum-wage jobs earn too much to qualify for Medicaid, the study found.