Effects of Medicaid Expansions and Welfare Declines on Prenatal Care Use

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A National Bureau of Economic Research paper analyzes policies related to Medicaid expansions and declining welfare caseloads in order to examine these policies' effects on infant health and on use of prenatal care. Using birth certificate data covering all US births between 1990 and 1996, the authors analyzed the effects of three factors: 1) changes in Medicaid income eligibility requirements, 2) decreases in welfare caseloads, and 3) administrative reforms designed to simplify the Medicaid application process. They found that more lenient income eligibility requirements for Medicaid (moving the cutoff point to above 133% of the federal poverty level) increased the use of prenatal care; that decreases in welfare caseloads reduced the use of prenatal care; and that administrative reforms (e.g., implementing a presumptive eligibility policy or simplifying enrollment forms) had little effect on the use of prenatal care.

The authors found that relaxing income eligibility requirements for Medicaid enrollment had a significant effect on the use of prenatal care. According to the authors, this finding suggests that the level of awareness of the program has increased.

Decreases in welfare caseloads reduced the use of prenatal care, particularly among blacks. The report notes that welfare rates' impact on prenatal care use illustrates the importance of the administrative link between Medicaid and welfare, "even in the face of dramatic expansions in income eligibility for [Medicaid], and the adoption of many administrative reforms intended to simplify enrollment." It also states that although the study period predates welfare reform, "our results indicate that among pregnant women, cuts in the welfare rolls are likely to be accompanied by reduced use of prenatal care by both whites and blacks."

Concerning infant health, the authors state that the effects of expanded income eligibility cutoffs for Medicaid and of reduced welfare caseloads are less clear and that they differ for whites and blacks.

Administrative Medicaid reforms adopted by states to reduce nonprice barriers to care (e.g., expediting applications for pregnant women; presuming that pregnant women are eligible for Medicaid while their applications are being processed [presumptive eligibility]; and not requiring a face-to-face interview for enrollment) were found to have little effect on rates of prenatal care use. The authors note, however, that a limitation of their study is that they did not conduct a direct assessment of the impact of two potentially significant changes: 1) the elimination of assets tests, and 2) the effects of outstationing eligibility workers. The report concludes: "However, we can infer from our results regarding the relationship between welfare rates and use of prenatal care that the administrative reforms were not enough to break the link between welfare and access to prenatal care under the Medicaid program."

Currie J, Grogger J. 2000. Medicaid expansions and welfare contractions: Offsetting effects on prenatal care and infant health? Cambridge, MA: National Bureau of Economic Research. The paper can be downloaded at http://papers.nber.org/papers/W7667.

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MCH Alert. 2001. Arlington, VA: National Center for Education in Maternal and Child Health. http://www.ncemch.org/alert.