ISSUE. States are facing large revenue shortfalls and budget deficits from the COVID-19 crisis. To close deficits, they will need to raise taxes, cut spending to critical public programs like Medicaid, or both. GOALS. Examine the long-term benefits of Medicaid coverage of children and pregnant women, and the likely impact of state Medicaid cuts for the short and long term. METHODS. Review of research literature on the long-term benefits of Medicaid coverage of children and pregnant women. KEY FINDINGS. Research shows Medicaid coverage of children and pregnant women is associated with improved health and lower rates of disability in adulthood. Medicaid coverage is also associated with higher educational attainment and greater financial security. Some studies find that Black children particularly benefit. Medicaid also produces financial benefits for society and a strong return on government investment. CONCLUSIONS. Because state and federal policymakers tend to focus more on short-term budget windows, they do not always consider long-term consequences. In addition to further temporary boosts in federal Medicaid funding, one potential policy solution is an automatic federal funding increase to avert Medicaid budget cuts during future economic downturns.
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