Summary: Expanding children's Medicaid eligibility has significantly increased the number of children who rely on Medicaid for health coverage. It has also cushioned the effect of declining employment-based health insurance coverage for children. Because of expanded eligibility, the proportion of children on Medicaid in working and in two-parent facilities has grown. Congress is considering welfare reform proposals that would encourage low-income mothers to work. However, many low-income jobs do not offer health insurance as a benefit. Even children who have full-time working parents and are part of two-parent households may lack health insurance. Although Medicaid has begun to help close that gap for some families, many more uninsured children are eligible for Medicaid than have been enrolled. Changes to Medicaid that remove guaranteed eligibility and change the financing and responsibilities of federal and state government may strongly affect health insurance coverage for children in the future. Children account for only a small portion of Medicaid costs. Because they represent almost half the participants, however, any changes to Medicaid disproportionately affect children. Changes to Medicaid that reduce the number of children covered, without any corresponding changes to encourage employers to provide dependent health insurance coverage or to provide other coverage options for children, could significantly increase the number of uninsured children in the future.
