States are facing a great fiscal crisis. At least 47 states faced or are facing shortfalls in their budgets for this and/or the next year or two. Combined budget gaps for the remainder of this fiscal year and state fiscal years 2010 and 2011 are estimated to total more than $350 billion.

Nearly four in ten parents report a decrease in their family’s income in the last six months; a similar percentage says the recession is affecting the lives of their children. 37% say their household income has declined, and that has left many parents having a harder time paying for food, utilities, even their child’s medical bills. Lower-income families report being especially hard-hit. The poll also asks about support for public programs for children.

Based on interviews with 27 families from six cities across the U.S, this report finds pervasive uncertainty over job security and households teetering on the financial brink. Health care costs were of particular concern, with many families, including some with health insurance, forgoing doctor visits, skipping prescription medications and postponing needed care. Despite barely being able to meet the cost of basic needs, many families did not qualify for public programs like Medicaid and CHIP.

The analysis projects that if the unemployment rate rises to 7 percent in 2009 (up from an average of 4.6 percent in 2007), Medicaid and SCHIP enrollment would increase by 2.4 million and an additional 2.6 million people would become uninsured. The impacts would increase if the unemployment rates climbs even further. The report also estimates the potential state costs for Medicaid, SCHIP and the uninsured under such a scenario, and the potential impact of proportional statewide budget cuts on Medicaid and SCHIP funding assuming that states maintain eligibility levels for public programs.

This report relays the perspective of leading state Medicaid directors to describe the fiscal strain on Medicaid and other safety-net programs as enrollment swells and state tax revenues shrink, raising the prospect of program cutbacks. It draws on focused interviews with leading Medicaid directors in November 2008.

This policy brief discusses several short-term options for strengthening Medicaid at time when the economic recession has increased demand for the program and constrained state budgets. It details potential steps such as increasing federal funding, easing enrollment barriers and temporarily expanding coverage

This policy brief discusses several short-term options for strengthening Medicaid at time when the economic recession has increased demand for the program and constrained state budgets. It details potential steps such as increasing federal funding, easing enrollment barriers and temporarily expanding coverage

Continuing economic problems have created budget problems in many states, leading some 25 states to reduce services to their residents, including some of their most vulnerable families and individuals. Some 14 states have increased taxes or taken other revenue raising measures to help mitigate the need for budget cuts and at least 17 states have implemented cuts that will affect low-income children’s or families’ eligibility for health insurance or reduce their access to health care services.

Ten years of progress on children's health care coverage is threatened by increasing unemployment, declining state revenues, and a growing affordability gap between family income and the cost of healthcare coverage. This report estimates that over the past year, 4.1 million people have lost their employer-based coverage, including 1.2 million children. It offers options to address the crisis, including temporarily increasing federal support for Medicaid and promptly reauthorizing SCHIP to soften the impact of the economic downturn on uninsured children.

About 57 million Americans were in families with problems paying medical bills in 2007—an increase of 14 million people since 2003. Although the rate of medical bill problems is much higher for uninsured people, most people with medical bill problems—42.5 million—had insurance coverage. About 2.2 million people with medical bill problems were in families that filed for bankruptcy as a result of their medical bills, and a much larger number reported other financial consequences, such as problems paying for other necessities and having to borrow money. The increase in medical bill problems—especially among insured people—is the main reason why more people reported unmet medical needs because of cost in 2007 than in 2003.

The economic downturn is forcing working families across the United States to make tough financial choices, often involving sacrificing needed health care and health insurance. This report examines the status of health insurance for adults and the implications for family finances and access to health care. Insurance coverage deteriorated over the past six years, with declines in coverage most severe for moderate-income families. As result, more families are experiencing medical bill problems or cost-related delays in getting needed care. In 2007, nearly two-thirds of U.S. adults, or an estimated 116 million people, struggled to pay medical bills, went without needed care because of cost, were uninsured for a time, or were underinsured.

When considering Medicaid’s impact on state budgets and other state spending priorities, it is important to distinguish between total spending and spending with state funds. In some states with more favorable federal Medicaid matching rates, the differences between the two can result in dramatically different stories, as federal funds may account for as much as two-thirds to three-quarters of state Medicaid spending. This series of issue briefs examines Medicaid’s role in state budgets and provides details on how much each state spends on Medicaid.

This report examines the implications of a downturn for health coverage and state programs. The authors project that a one percentage point rise in the national unemployment rate would increase Medicaid and SCHIP enrollment by 1 million and the number of uninsured by 1.1 million. The analysis also documents how federal fiscal relief during the last economic downturn of 2003-2004 helped to stabilize Medicaid eligibility and let states avoid deeper budget cuts.

During an economic downturn, demand for Medicaid rises as more people fall into poverty or lose their employer sponsored coverage and become uninsured.  At the same time, state revenues decline, affecting states’ ability to balance their budgets and to fund programs such as Medicaid.  This brief analyzes results from its annual 50-state budget surveys of Medicaid directors from 2003 to 2007 and describes how states adopted a wide array of Medicaid cost containment strategies during the last economic downturn and were assisted by the federal government to avoid deeper Medicaid cuts.

From 2000 to 2004, during a period of economic recession, the number of uninsured Americans increased by 6.0 million. The number increased by 3.4 million between 2004 and 2006, despite improving economic conditions during that time. The dominant factor in both periods was a decline in employer-sponsored insurance coverage. Although the recent decline was less than that experienced from 2000 to 2004, growth in public coverage was small, and the number of uninsured people increased by 1.0 million children and 2.4 million adults. Employer coverage declined most for self-employed or small-firm workers, in the South, and among noncitizens.

Maintaining Medicaid coverage during downturns in the economic cycle is a significant policy challenge for states. In recessions, states struggle to finance the cost of Medicaid coverage, which increases as people lose jobs and the health coverage that comes with them, becoming eligible for Medicaid. At the same time, state revenues, mirror¬ing the weak economy, generally become stagnant or decline. This issue brief paper offers four alternative approaches that the federal government could take to strengthen state Medicaid financing programs during periods of economic challenge.