Medicaid and Children’s Health: 5 Issues to Watch Amid Recent Federal Changes

The uninsured rate, supplemental poverty rate, and food insecurity for children have all increased since the expiration of pandemic-era fiscal relief, and high household costs, including health care costs, are putting pressure on family budgets. After increasing during the pandemic, overall federal spending on children as a share of the economy (or GDP) has declined and is projected to continue to decline further over the next 10 years. At the same time, over the last decade, rates of chronic conditions among children, including obesity and mental health concerns, have increased. At the same time, children’s routine vaccination rates are declining, and many states are contending with measles outbreaks. Recent federal changes (Box 1), including the recently passed reconciliation law, administrative actions by the Centers for Medicare & Medicaid Services (CMS), and other broader Trump administration changes, could have further implications for children and their health and well-being. Nearly four in 10 children in the U.S. are covered by Medicaid, making the program (and changes to the program) particularly relevant to broader children’s health trends. This issue brief explores the latest data on Medicaid and children’s health and highlights five key issues to watch as federal changes are implemented (Figure 1).

Figure 1

1. Health Insurance Coverage

The uninsured rate for children has declined over time but has increased in the past two years. The uninsured rate for children has declined from 10.4% in 2008 to 6.0% in 2024 (Figure 2), largely due to policies at the state and federal level that expanded and streamlined Medicaid coverage, including the ACA Medicaid expansion. The children’s uninsured rate fell to an all-time low in 2016 (4.7%) before ticking up during the first Trump administration, when generally favorable economic conditions as well as Trump administration policy changes led to declines in Medicaid enrollment. The children’s uninsured rate declined again following the onset of the COVID-19 pandemic, but did increase slightly from 5.1% in 2022 to 5.3% in 2023 (a statistically significant increase of 0.2%), driven by a decline in Medicaid coverage as children lost coverage due to the unwinding of the Medicaid continuous enrollment provision, a pandemic-era policy. These trends continued in 2024, and recent federal changes could further reduce children’s Medicaid coverage and increase the number of children who are uninsured in the coming years.

2. Variation in Coverage Across States

The share of children covered by Medicaid varies substantially by state. Overall, Medicaid covers nearly 4 in 10 children in the U.S., but the share of children covered by Medicaid in each state varies, ranging from under 20% in Utah to over 60% in New Mexico (Figure 3). Seven states (Alabama, Kentucky, Oklahoma, Arkansas, Mississippi, Louisiana, and New Mexico) have over 45% of children enrolled in Medicaid. Medicaid also finances about 4 in 10 births nationally and over half of births in four states (Louisiana, Mississippi, New Mexico, Oklahoma). The program plays a particularly large role in rural areas, paying for nearly half of all births in rural communities and helping to shore up financing for hospitals in rural areas suffering from provider shortages. Research also shows that Medicaid enrollment in childhood can lead to better health outcomes throughout life, increase earnings in adulthood, and potentially reduce future federal spending. A number of states have expanded access to Medicaid and CHIP coverage for children since the pandemic began, but recent federal efforts could reverse this trend. The magnitude of Medicaid budget cuts stemming from the reconciliation law and the extent to which children may be impacted will vary across states, depending on state characteristics as well as how states implement and respond to various provisions.

3. Access to Care

Uninsured children are more likely to forgo needed care than children with health insurance coverage. Research has shown that health coverage provides children with access to needed care, and survey data show uninsured children are more likely than those with private insurance or Medicaid to report going without needed care due to cost and that they had not seen a doctor in the past year (Figure 4). Medicaid’s benefit package for children, Early and Periodic Screening, Diagnostic and Treatment (EPSDT), helps meet children’s health care needs and protects them from high out-of-pocket costs. Under EPSDT, states are required to cover primary care and screening services for children well as any services “necessary… to correct or ameliorate” a child’s physical or mental health condition. This is especially important for children with special health care needs as Medicaid provides more comprehensive coverage for children than the typical private insurance plan and increases access to needed services that improve the quality of daily life, including long-term care and home care.

Some children with Medicaid still face barriers to accessing care. Administrative data have shown that only half of Medicaid enrolled children receive a well-child visit or any kind of dental service within the year. These low rates indicate Medicaid children face barriers to accessing care, including a lack of available providers in their community. Children can also experience challenges accessing behavioral health care, with 57% of children reporting difficulties obtaining mental health care in 2023. Provider rate cuts in response to recent federal changes could reduce access to care, likely contributing to even lower rates of utilization among children and exacerbating access issues for services such as behavioral health care. Other broader Trump administration changes could also have implications for access, including recent changes to vaccine recommendations as well as MAHA commission proposals to enhance prior authorization requirements to prevent “the overuse of medications in school-age children—particularly for conditions such as ADHD”.

4. Access to Care in Schools

Medicaid coverage can facilitate access to care for children, including children with special education plans, in school. There are an estimated 7 million children, or 10% of all children in the U.S., who currently have special education plans. This includes children receiving special education services under a special education or early intervention plan (often an Individualized Education Plan (IEP) or Individualized Family Service Plan). Medicaid covers half of all children with special education plans, though the share varies by state ranging from 26% in New Jersey to 73% in Kentucky (Figure 5). Medicaid provides significant financing for the delivery of services in schools including reimbursement for medically necessary services that are part of a student’s special education plan, for eligible health services for students with Medicaid coverage more broadly, and for some administrative activities. Recent federal cuts are expected to squeeze school district budgets, potentially affecting school services and reducing access, including for students with special education plans.

As youth mental health concerns have grown, both the federal government and states have taken action to expand access to school-based mental health care. Schools receive support for providing mental health services in several ways, including support at the federal level through DOE and HHS, as well as through Medicaid, and nearly one in five students attending public schools in the U.S. utilize school-based mental health services. School-based mental health services can improve access to care and reduce access barriers for underserved populations, including children from low-income households and children of color. Recent cuts, including reductions in coverages as well as cuts to DOE and HHS staff, could dampen recent efforts to increase access to mental health care in schools.

5. Family Financial Security

Children with Medicaid experience higher rates of food insecurity than children overall. Survey data show that 19% of all children in the U.S. and 30% of children covered by Medicaid live in households that experience food insecurity, meaning they are unable to access adequate food due to lack of money or other resources (Figure 6). U.S. Department of Agriculture (USDA) data also show that food insecurity among children has increased in recent years. Food insecurity is associated with multiple chronic conditions, poorer self-reported health status, higher health care utilization, and lower rates of medication adherence. Overall, 19% of children, and 41% of children with Medicaid, receive SNAP benefits. Several studies indicate that individuals who receive SNAP benefits have better health and lower rates of food insecurity than similar people who are eligible but not receiving these benefits. While the MAHA commission highlights the importance of nutrition in recent recommendations, federal SNAP cuts in the reconciliation law could worsen access to food for children.

Medicaid covers 8 in 10 children living in poverty or over 9 million of the almost 12 million children who lived in poverty in 2023 (measured using the official poverty measure; the poverty threshold for a family with two adults and one child was $24,526 in 2023). New data show that from 2023 to 2024 the official poverty rate for children declined slightly and the supplemental poverty rate, which accounts for a wider set of resources, held steady; however, the supplemental poverty rate for children remains more than double what it was in 2021 due to the expiration of pandemic-era federal support. Inflation has cooled since 2022, but household costs remain high, contributing to additional financial hardship and increased food insecurity for families. Federal cuts in the reconciliation law and other recent federal changes could worsen affordability challenges and could lead to further increases in poverty and, ultimately, poorer health outcomes.