Medicaid enrollment dropped for the first time in more than a decade, as the economy strengthens and – as a result – fewer Americans meet eligibility requirements.
The Kaiser Family Foundation reported on Thursday that growth in Medicaid enrollment for fiscal year 2018 declined 0.6 percent, the first time it has fallen since 2007. The program is designed to provide coverage to Americans with limited financial resources.
States don’t expect to see any meaningful increases in enrollment for fiscal year 2019, either. The decline has been largely attributed to a strengthening economy, which has lifted more lower-income Americans out of poverty.
Last month, the Labor Department reported that the U.S. unemployment rate dropped to 3.7 percent – the lowest level in almost 50 years.
Additionally, some states said efforts to crack down on recipients’ continued eligibility also lowered enrollment.
Still, Medicaid spending increased among states by 4.2 percent and is projected to rise another 5.3 percent for fiscal 2019. According to the Kaiser Family Foundation report, spending rose despite a decline in enrollment because prescription drug costs remain high and spending for specialized care – like substance-use treatment and long-term care for seniors – increased. Additionally, fewer younger Americans enrolled in Medicaid compared with seniors and individuals with disabilities – who have more expensive coverage needs.
The Trump administration has encouraged states to implement a work requirement for Medicaid eligibility. As a number of states – including Kentucky and New Hampshire – are either implementing or pursuing this option, enrollment numbers are expected to decline.
As of June 2018, 73 million people were covered by Medicaid. Spending in fiscal 2017 totaled $557 billion, with 62 percent of the bill footed by the federal government. Medicaid accounts for 20 percent of the dollars spent in the health care system, according to the Kaiser Family Foundation.
The Trump administration has been clear about its intent to wean lower-income Americans off welfare programs by putting them back to work.
“If you’re in this country and you want to work … We’re going to get 3 percent growth and we’re going to give you the opportunity to work,” Office of Management and Budget Director Mick Mulvaney said last year.
The U.S. economy grew at a rate of 4.2 percent in the second quarter, the highest level since 2014.
In August, the U.S. Department of Agriculture reported that 2.8 million individuals dropped off of the Supplemental Nutritional Assistance Program (SNAP) since Trump’s first full month in office. As of May, enrollment in the program was about 39.3 million, compared with 42.1 million in February of last year.