8 Facts You Should Know about Medicaid & Rural America

Medicaid provides long-term care for millions of seniors, helps people with disabilities live independently, and provides health coverage so children can see a doctor when they get sick. A new Center for Rural Affairs report – Medicaid and Rural America – examines the vital role Medicaid plays in rural areas.

In general, more rural residents than urban residents participate in Medicaid – the joint federal and state health insurance program. The most recent data on Medicaid coverage show that 16 percent of rural residents had Medicaid coverage in the past year, compared to 13 percent of urban residents. And a recent analysis of those eligible for Medicaid from state data affirms the importance of Medicaid to rural people.

Data from 35 states and the District of Columbia shows that more rural than urban residents are eligible for Medicaid in 31 states. (New Jersey and the District of Columbia have no rural counties.) In 13 states the rural-urban variation was five percent higher for the rural population.

The rural-urban difference is even greater for children. The most recent data show that 35 percent of rural children are enrolled in Medicaid, compared to 28 percent of urban children.

Unique characteristics of rural communities make Medicaid crucial for rural people and rural places. The demographics and health care infrastructure of rural America make Medicaid a vital source of insurance coverage, filling gaps in Medicare coverage and the availability of private insurance.

Rural poverty rates are generally higher. Rural residents have lower rates of employer-sponsored health insurance. Rural areas have a higher proportion of older persons in their total population. And rural areas have higher rates of people living with disabilities. All those populations rely on Medicaid for their health care needs.

Many perceive Medicaid as the classic ‘welfare’ program. That perception is simply not true. About 65 percent of families with non-elderly Medicaid enrollees have at least one worker in the family. Nearly half have at least one full-time worker.

The Center for Rural Affairs report makes a detailed case that Medicaid is a critical piece of the rural health care system. The connections between rural areas and Medicaid include:

  1. The unique rural demographics of an older, lower income, more disabled and less healthy population with lower rates of private health insurance require a well-functioning Medicaid program.
  2. Medicaid provides health insurance coverage and health care access for rural children and people with disabilities, both with limited health insurance options.
  3. Significantly more people in rural areas would be without health insurance without Medicaid coverage.
  4. Medicaid is a primary financer of long-term care, vital in rural areas with higher rates of elderly population and greater reliance on nursing facilities.
  5. Medicaid helps expand health services – particularly mental health services – that would otherwise be limited or nonexistent in rural areas.
  6. Medicaid keeps health care facilities and health care providers in rural areas by providing a significant portion of patient revenue.
  7. Medicaid enhances the quality of life in rural areas by providing greater access to rural health care services.
  8. Medicaid helps the rural economy by providing jobs and local revenue.

Medicaid is also vital to the economies of rural communities and to the future of the rural health care infrastructure. Health care providers, especially those who serve large percentages of Medicaid patients, rely on Medicaid payments to cover the costs of treating those patients. Federal and state Medicaid dollars contribute to rural economic development by generating health care jobs and other related businesses and services.

A full copy of the report can be viewed and downloaded here.

If you have questions, please contact me, Jon Bailey, at 402.687.2100 or jonb@cfra.org.