As the health care debate continues at the federal level and states pursue changes to their Medicaid programs through waivers, it is important to consider how health care costs fit into family budgets and how changes to Medicaid could affect family finances and access to care. Based on 21 interviews with Medicaid enrollees in five cities, this brief examines their family budgets, how health care costs fit into these budgets, and their views on how potential changes to health care could affect them. It finds: (1) Most participants with Medicaid coverage are in a working family but live on very strained budgets with costs for basic needs taking up the majority of their monthly income. Participants are in low-wage jobs that often have fluctuating incomes, such as customer service representatives, retail workers, food service workers, daycare workers, home care attendants and warehouse employees. Those who are not working are caring for children or other family members, have a disability or serious health problem, are recently unemployed and seeking work, or are full-time students. Costs for basic needs such as housing, food, and transportation take up nearly all of their monthly income, and they often come up short on their monthly bills. Financial pressures cause them significant stress and anxiety, keeping them up at night and exacerbating health problems like depression and anxiety. (2) Given their limited budgets, Medicaid is key for enabling participants to afford coverage and needed care. Most participants do not have access to or cannot afford employer-based coverage and were uninsured before they gained Medicaid. Some became eligible under the Affordable Care Act (ACA) Medicaid expansion; others qualify through eligibility pathways that existed before the ACA. Given their limited budgets, participants have little ability to pay for health care. They noted that they would not be able to afford coverage or care without Medicaid's limited out of pocket costs. Participants reported getting needed care and generally were satisfied with their Medicaid coverage. Some pointed to challenges finding some specialists, such as psychiatrists, and some wished for broader vision and dental coverage for adults. (3) Participants were concerned they would need to make trade-offs between paying for basic needs and going without care if their costs for health coverage and/or care increased. Participants noted that they do not have room in their budgets for increased health expenses. They pointed out that even small premiums or copayments could add up across family members or for multiple services or prescription drugs. Moreover, if they lost Medicaid, they do not think they would be able to afford other coverage. As such, increases in premiums or copays in Medicaid would likely lead to access barriers for these individuals and create further strain on their budgets. Similarly, these individuals would face higher costs in the form of premiums and cost sharing in Marketplace or other private plans.
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