A Closer Look at the Medicaid Coverage Gap: Most Work, Many in Rural Areas

While a majority of states have accepted federal money to expand health coverage to their lowest-income citizens, many states are still declining funding available under the Affordable Care Act. Reports based on recent federal census data from these states show that most people who would finally gain affordable coverage if Medicaid were expanded are working or are part of a working family and many live in the most rural areas of the country.

A extensive analysis by the Kaiser Family Foundation found most adults in this Medicaid coverage gap in states that have not yet adopted the expansion are in a working family. Sixty percent of uninsured adults in this gap live in a family with a worker; the majority of those workers are employed by small firms that typically don’t offer health coverage such as agriculture or service industries.

Nearly two-thirds of working adults in the coverage gap live in just five states. According to another Kaiser Family Foundation report, more than one-fifth of coverage gap adults reside in Texas, which has both a large uninsured population and strict limits on Medicaid eligibility. Sixteen percent live in Florida, nine percent in Georgia, seven percent live in North Carolina, and six percent live in Pennsylvania.

Similarly, a report issued this month by the consumer group Families USA looked at data available in three states – Utah, Virginia, and Missouri – and found that 60 to 66% of the states’ uninsured residents were working adults with jobs who would benefit from a Medicaid expansion. A closer look at their employment shows lower-wage jobs, from cashiers and home health aides to janitors. The jobs are often seasonal, part-time, and don’t offer health benefits along with their already-low wages.

Not only are a majority of adults in the Medicaid gap part of a working family, but a majority – 60% – of adults in the gap live in states with large rural and often poor populations. Rural areas of these states have fewer large industries and significant numbers of people working in agricultural or service jobs. The United States Department of Agriculture tracks these statistics and documents the higher rates of rural poverty compared to urban areas, especially the distressingly high rate of child poverty in rural areas—nearly 27%. A look at the distribution map of rural poverty rates below shows clearly how the deepest rural poverty is located away from the nation’s industrial centers and is concentrated in many states that have so far refused federal money for Medicaid expansion.


The reality of rural poverty meeting the Medicaid gap leads to news stories in states like this one from North Carolina. Outreach workers in rural counties enrolling people in new Affordable Care Act coverage reported having to turn away large numbers of people with incomes who were caught in the gap – too low (under the poverty line) to qualify for tax credits to purchase marketplace plans but with no Medicaid coverage available. More than half of people inquiring about affordable health coverage at one rural health department highlighted were unable to get any coverage since North Carolina has not expanded Medicaid and so they were too poor to get help. You don’t need to look long to find similar stories from other states like this one in Nebraska, documenting a small rancher’s inability to qualify for Medicaid coverage because Nebraska had turned down the federal expansion money or this one from Missouri highlighting the disproportionate impact of the state’s refusal to expand Medicaid in rural areas.

Taken together, reports and news stories like these continue to paint a stark picture of people most affected by state decisions that allow the Medicaid coverage gap to persist in states like Texas, Nebraska, and North Carolina. These politically motivated decisions most often impact hard-working families living in our country’s more isolated and poor areas, far away from industry and urban growth. While rural areas in states that have expanded Medicaid under the Affordable Care Act are seeing remarkable gains in health coverage, states that continue to refuse federal funding keep many of their hardest working citizens in their most rural areas from health benefits now available in a majority of the country.

Adam Searing is an Associate Professor at the Georgetown University McCourt School of Public Policy’s Center for Children and Families.