Study Indicates "Welcome Mat" Effects of Medicaid Expansion on Children's Coverage

New research suggests that the expansion of Medicaid under the Affordable Care Act (ACA) was linked to gains in coverage among children who were already eligible. Newly insured adults may have learned of options to get their children covered as well, creating a “welcome mat” effect.

After the implementation of the ACA in 2014, the rate of uninsured low-income children and adults decreased significantly. The children were already eligible for but not enrolled in public coverage, leading observers to suggest that the expansion of Medicaid to more adults was having a spillover or “welcome mat” effect on their children. The new study, published in Health Affairs, is the first to measure welcome mat effects on Medicaid-eligible children at the national level.

"While the decline in uninsurance for children was smaller in magnitude than the decline precipitated by the ACA for adults, coverage effects among low-income children in this period were notable because such children experienced very few changes in eligibility when ACA provisions were implemented in 2014," the authors wrote.

Using 2013-2015 data from the American Community Survey, researchers constructed a sample of children who were eligible for Medicaid both before and after the ACA’s implementation. They were classified based on whether their parents had always been, never been, or newly became eligible for Medicaid under the expansion. Analyses assessed public coverage among the children while controlling for parents’ Medicaid eligibility, residency in expansion state, and individual- and family-level sociodemographic factors.

Gains in coverage were observed for all children regardless of parental Medicaid eligibility, but the largest increase from 2013 to 2015 was observed among those with newly eligible parents. They experienced a 5.6 percentage-point increase in coverage, compared to a gain of 3 percentage points among those whose parents were never eligible.

Similarly, all children in the sample were less likely to be uninsured in 2015 compared with 2013, but the children with newly eligible parents showed the most improvement, as their odds of being uninsured decreased by 4.1 percentage points.

The researchers projected that 710,000 low-income children gained public coverage between 2013 and 2015 despite already being eligible for Medicaid. They estimate that an additional 200,000 such children could have gained coverage if every state had expanded Medicaid.

“Our finding that enrollment effects were larger among children in families with joint parent/ child Medicaid eligibility speaks to the importance of factoring in family-level decision making when crafting health policy,” the authors wrote. They noted that parents may find it easier to make coverage and enrollment decisions for their whole family if they themselves are enrolled in public insurance.

Future research could explore welcome-mat effects among noncitizens and children eligible for the Children’s Health Insurance Program (CHIP), who were excluded from this study, the researchers wrote. They suggested that similar welcome-mat effects may have occurred when non-low-income adults gained coverage through the insurance exchanges. They also recommended monitoring coverage trends for years past 2015.

Finally, the study authors discussed their findings in the context of a changing policy landscape, as ACA repeal remains a possibility and CHIP funding needs to be reauthorized.

“It is important to recognize that prior research also predicts that the gains we found among Medicaid-eligible children could be lost if their parents lose Medicaid eligibility or insurance coverage,” they wrote.