Medicaid survey shows improved coverage, healthcare reform challenges ahead

More than half of U.S. states allowed more people to get on Medicaid in 2010 or made it easier for them to enroll, according to a new report, helping to prevent a steep increase in the number of uninsured Americans during the economic recession.

The report from the Kaiser Family Foundation credits the 2009 Recovery Act and last year's healthcare reform law for providing more funding to states while preventing them from dropping people from the rolls. Partly as a result, 14 states made it easier to enroll into Medicaid or the Children's Health Insurance Program (CHIP), while 13 expanded eligibility.

"This striking stability in public programs," says a summary of the report, "can be directly attributed to the federal government's decision both to provide temporary Medicaid fiscal relief to states through June 2011, and to require states to maintain their Medicaid and CHIP eligibility rules and enrollment procedures until broader health reform goes into effect."

The report warns, however, that states have a ways to go in terms of adopting technological improvements necessary to deal with the massive expansion of the Medicaid program called for under Democrats' healthcare reform law. By 2014, states will be required to cover people up to 133 percent of the federal poverty level.

The report comes as many states are considering steep budget cuts to rein in deficits caused in part by the poor economy. While the costly state-federal Medicaid partnerships prohibit major changes to enrollment eligibility, several states have already cut provider reimbursement rates and certain benefits.

And two states, the report explains, made permissible coverage reductions before the new healthcare reform law went into effect: Arizona capped enrollment in its CHIP program and New Jersey stopped enrolling parents covered through a CHIP waiver.