Nearly 6 in 10 US Adults Say They’ve Been on Medicaid or Have a Loved-One Who Has
Why do so many Americans have a personal connection to a program meant to help the needy?
In March, the Kaiser Family Foundation (KFF) released a poll with a shocking revelation: 59% of US adults report having been on Medicaid at some point in their lives, or knowing a family member or close friend who has. With a poverty rate below 13%, how is that possible in a program designed as a safety net for the indigent?
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Two factors go a long way in explaining this apparent discrepancy.
Although it’s common to think of socioeconomic classes as rigid and immutable — a stereotype reinforced by constant talk of widening income inequality framed as “us vs. them” — the reality is that Americans are constantly moving up and down the economic ladder. Few people toil through life moving from one dead-end, minimum wage job to the next. Such workers exist, of course, but they account for a small minority of the people in poverty.
Poverty is usually temporary, brought on by unemployment, injury, or other setbacks. While the poverty rate in any given year hovers around 11-15%, nearly 60% of Americans will live in poverty for at least one year between the ages of 20 and 75 and an additional 15% of Americans will experience near poverty, defined as living below 150% of the federal poverty level. (For context, in 2023 the federal poverty level is about $15,000 for a single person and $30,000 for a family of four.)
Although poverty is no guarantee of Medicaid eligibility (especially in states that have opted not to expand Medicaid), it greatly increases the probability of qualifying for benefits. Consequently, many Americans enroll in Medicaid during brief spells of financial difficulty. When they regain their footing, they leave the program. Among adults without disabilities, for example, about one-third of those enrolled in Medicaid at any given time are off the program one year later. This comports with Medicaid’s original intent, to “furnish rehabilitation and other services to help such families and individuals attain or retain capability for independence or self-care.” If 75% of Americans were experiencing hard times at some point in their lives and only, say, 20% reported ever being on Medicaid, one might wonder whether the program was properly fulfilling its safety-net function.
KFF’s findings also stem from another fact: Medicaid’s eligibility policies have changed dramatically in the last half-century, allowing a growing share of the US population to qualify for the program.
As Gary Alexander of the Paragon Health Institute has pointed out, there are approximately twice as many Medicaid recipients as people in poverty. Medicaid enrollment has grown from about 8% of Americans in the late 1980s to 27% of the population at the end of 2022. And although the continuous enrollment requirement adopted during the pandemic has contributed to Medicaid’s growth, the trends long predate COVID-19.
As the graph below shows, across all income groups, the proportion of the non-elderly population covered by Medicaid has increased sharply — driven mainly by those above the poverty level. In 1984, virtually no one earning more than 200% of the poverty level was on Medicaid. In 2019, the Medicaid rolls included 12.6% of those earning 200-399% of the federal poverty level and 2.7% of those earning 400% or more of the federal poverty level.
This shift has occurred as policymakers have repeatedly expanded Medicaid eligibility to new groups or raised income thresholds for existing beneficiaries. From the 1980s to the early 2000s, Congress and the states gradually made it easier for pregnant women, children, and patients with certain specific diseases to qualify for the program. In 2013, only eight states (and DC) offered Medicaid coverage to able-bodied adults without dependents (ABAWDs). Today, under the Affordable Care Act, low-income ABAWDs are eligible for Medicaid in all but 11 states (and two of those, South Dakota and North Carolina, are expected to begin extending coverage to ABAWDs soon).
And while a significant portion of Medicaid enrollment consists of those temporarily down on their luck, the program is also home to a large number of long-term recipients. The same study I cited earlier found that about half of non-disabled adults enrolled in Medicaid at a given time will be on the program nine years later (though only about 13% are continuously enrolled during the entire period). The authors of that analysis observed: “On one hand, Medicaid now provides a valuable coverage option for millions of low-income families who might otherwise be uninsured. On the other hand, the extended use of Medicaid for many beneficiaries reflects what seems to be a semipermanent group of families with incomes close to the poverty line.”
Those twin forces lie behind KFF’s eye-popping numbers.