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Medicaid and Rural America

by The Center for Rural Affairs, Syracuse Journal-Democrat

March 1, 2012

Picture Credit: Center for Rural Affairs

Lyons, Neb. —Medicaid protects long-term care for millions of seniors, helps people with disabilities live independently and provides health coverage that ensures children can see a doctor when they get sick. The Center for Rural Affairs released a new health care report today, entitled – Medicaid and Rural America – that examines these and other vital roles Medicaid plays in rural areas.

“A variety of unique characteristics of rural communities make Medicaid crucial for rural people and rural places,” said Jon Bailey, Rural Research Director at the Center for Rural Affairs and author of the report.

Bailey also pointed out that the Nebraska Legislature is considering two bills in response to proposed cuts to Medicaid services for seniors, children and people with disabilities. LB 826 would require approval of the Legislature for any changes to Nebraska’s Medicaid program. LB 952 would proactively stop proposed cuts to services for over 170,000 Nebraskans, including proposed eliminations or cuts in senior home health services, nursing visits for the elderly and disabled, childhood nutrition services and behavioral health therapy for children.

“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,” Bailey continued.

According to Bailey, rural poverty rates are generally higher. Rural residents have lower rates of employer-sponsored health insurance. And rural areas have a higher proportion of older persons in their total population.

Bailey’s report goes on to explain that about 65 percent of families with non-elderly Medicaid enrollees have at least one worker in the family, with nearly half having at least one full-time worker.

“Many perceive Medicaid as the classic ‘welfare’ program,” said Bailey. “That perception is simply not true.”

A full copy of the report can be viewed and downloaded at: http://files.cfra.org/pdf/Medicaid.pdf.

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:

  • 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.
  • Medicaid provides health insurance coverage and health care access for rural children and the disabled, both with limited health insurance options.
  • Significantly more people in rural areas would be without health insurance without Medicaid coverage.
  • 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.
  • Medicaid helps expand health services—particularly mental health services—that would otherwise be limited or nonexistent in rural areas.
  • Medicaid keeps health care facilities and health care providers in rural areas by providing a significant portion of patient revenue.
  • Medicaid enhances the quality of life in rural areas by providing greater access to rural health care services.
  • Medicaid helps the rural economy by providing jobs and local revenue.

In the report, Bailey also provides evidence that Medicaid is also vital to the rural health care infrastructure and to rural communities. 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.

“In many respects, Medicaid has become a rural program,” explained Bailey.

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.

The 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 percentage points higher for the rural population.

“The importance of Medicaid to certain populations - children, low-income disabled, low-income elderly and pregnant women - in rural America is especially striking,” Bailey concluded.

Established in 1973, the Center for Rural Affairs is a private, non-profit organization working to strengthen small businesses, family farms and ranches, and rural communities through action oriented programs addressing social, economic, and environmental issues.

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