Recession drove millions on to Medicaid rolls

The woeful state of the economy drove more people to sign up for Medicaid from June 2008 to June 2009 than during any 12-month period in the program's history, according to a study released by the Kaiser Commission on Medicaid and the Uninsured.

Nearly 3.3 million new people began receiving Medicaid benefits, bringing the program's enrollment to 46.9 million people. As people lose their jobs, lose the health benefits at their jobs or find they cannot afford private insurance, they are increasingly turning to the joint federal-state safety-program.

“State Medicaid programs have been able to help millions of Americans who have nowhere else to turn in a recession,” Diane Rowland, the executive vice president of the Kaiser Family Foundation and the executive director of the Medicaid commission, said in a statement.  “But the states obviously face significant fiscal pressures as increases in enrollment push up costs at a time when state budgets are already severely constrained.”

The study shows that Medicaid enrollment has been rising since the recession started in December 2007 -- and is expected to keep climbing. Though Medicaid typically grows during periods of economic downtown, and then shrinks when the economy recovers, the Kaiser researchers indicate that the current trend is more pronounced than usual. The increase in Medicaid enrollment and expenditures is a big reason why the federal government's share of the healthcare system continues to grow.

Every state's Medicaid program saw an increase for the first time since the early 1990s. The enrollment growth reached double digits in 32 states. The increases ranged widely from less than 1 percent in Rhode Island to 20.4 percent in Maryland.

State Medicaid directors in 29 states said they were considering cutbacks -- a subject that will be explored during this weekend's meeting of the National Governors Association in Washington.

Last year's stimulus bill included a boost in the federal share of Medicaid costs as part of the package of spending items targeted to states but those dollars are set to run out at the end of this year. President Barack Obama requested an additional $25 billion in federal Medicaid spending in his fiscal year 2011 budget.

Kaiser's Medicaid commission plans a press event on these figures on related issues on Monday and has posted a comprehensive set of resources on the subjects.

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