How Might State Medicaid and Other Health Programs Be Affected in the Pandemic's Aftermath?

This report examines how state Medicaid and other health programs responded to the COVID-19 pandemic and its related economic downturn. It also explores the outlook for these programs in the year ahead as governors and state legislatures work to balance their FY 2022 budgets. Drawing from interviews with experts on Medicaid and behavioral health, public health, and maternal and child health programs between December 2020 and February 2021, and other sources, we find that although the economy has recovered better than most predicted, this recovery has varied tremendously by state and implications for health care safety net programs vary similarly. Effects have been different across population groups as well, with low-wage and service industry workers and communities of color experiencing higher unemployment, morbidity, and mortality rates during the pandemic. Federal financial relief, including direct aid to state, local, and tribal governments, has played a massive role in mitigating harm and helping many weather the economic downturn, and enhanced federal matching funds and the public health emergency's maintenance-of-effort (MOE) rules largely protected state Medicaid programs and beneficiaries. Behavioral health, public health, and maternal and child health programs also received supplemental federal fundscritical to their pandemic responses and populations that depend on them. The pandemic has had far-reaching effects on how beneficiaries seek and providers deliver health care services, including dramatic increases in telehealth use. Finally, some experts are optimistic that improvements to the health care safety net could occur as policymakers use the experience of the pandemic to reimagine programs as nimbler, more equitable, more holistic and focused on prevention, and better prepared for the next emergency.