Before 1965, Americans without health insurance were left to their own devices when it came to paying for medical care. Doctors’ visits, prescription medications, even hospital bills often had to be paid out of the pockets of individuals and families. As a result, a large portion of the population was left uninsured or under-insured. Three groups of Americans who perhaps need medical care the most were particularly vulnerable. Children, the elderly, and the poor were hit especially hard when it came to health insurance.
Even before 1965, the cost of health care was skyrocketing, making it unattainable for millions of Americans. To address this problem, the United States government created Medicare insurance to provide coverage for Americans age 65 and older. While senior citizens were now eligible for health care insurance, other groups were still without coverage. To remedy this, that same year, Medicaid insurance was created to provide additional health benefits for senior citizens, as well as insurance for many other members of our society.
• What is Medicaid insurance? Medicaid insurance is an insurance program jointly funded by state and federal governments to provide coverage for certain eligible persons. Since Medicare was established to provide insurance only for the elderly, a large segment of the population was still left uninsured. Recognizing the need to provide health care for children, the disabled, and the poor, as well as to seniors, the government intervened and Medicaid insurance was created.
• Who is covered under Medicaid insurance? Medicaid was designed to provide health insurance for people earning low incomes, as well as for those who were unemployed. An individual’s annual income is the governing factor in determining eligibility for Medicaid insurance. The amount of property an individual owns also plays a part in eligibility determination. When it has been determined that the person meets the financial criteria, he or she may be covered under this insurance plan. When the financial criteria have been met, persons who are age 65 and over are entitled to receive Medicaid insurance benefits. Children under the age of 19 (or under the age of 21 if living in foster homes) may be covered. Persons with certain disabilities including those who are blind are generally entitled to Medicaid insurance. Some patients in end-state renal failure are sometimes entitled to these benefits as well. Regardless of age, some individuals with breast or cervical cancer may be entitled to this insurance, as long as they meet the other criteria.
• How much does the individual pay for Medicaid insurance? States are not allowed to charge individuals any premiums for this coverage. Participating physicians and other health care providers are not allowed to charge patients above what Medicaid pays. Some states, however, do require the insured to pay co-payments or meet a small deductible. States are not allowed to charge co-pays for emergency medical care or for family planning services. Pregnant women, minor children, and nursing home residents, as well as certain other individuals, are exempt from these co-payments.
• How much does the program cost the government? Already a multi-billion dollar expense, the cost to provide Medicaid insurance has risen dramatically with the recent economic downturns. With the growing unemployment rates, more Americans are becoming eligible for Medicaid insurance. According to a 2007 report, Medicaid expenditures accounted for 17% of the federal budget. States, on the other hand, were bearing the brunt of the expense, often with over 44% of state budgets allocated to paying Medicaid related expenses. As economic conditions improve, and unemployment is reduced, states hope to experience some financial relief from this burden.
Medicaid insurance is a two-edge sword. On one hand it provides health insurance to millions of Americans who would otherwise be uninsured. To provide this coverage, however, costs the governments and ultimately the taxpayers, billions of dollars annually.