The NorthLakes Community Clinic health center in Washburn is one of a group of community health centers across northern Wisconsin. A new report finds that rural residents are at least as likely to rely on Medicaid for health coverage as people in other communities. (Photo courtesy of NorthLakes Community Clinic)
Residents of rural areas and small towns are more likely to rely on Medicaid for health coverage than city dwellers, a new report issued Wednesday finds.
Authors of the report said the findings highlight the potential harm that could particularly affect rural residents if Congress imposes drastic cuts to Medicaid as is reportedly being considered.
The analysis was released by the Georgetown University Center for Children and Families less than a week after a published report that U.S. House Republicans are contemplating cutting Medicaid by up to $2.3 trillion as part of their plan to renew tax cuts enacted in the first Trump administration.
“That equates to almost one-third of federal Medicaid spending,” said Joan Alker, executive director of the center and a research professor at Georgetown’s McCourt School of Public Policy, during an online press briefing Wednesday. “Rural communities are at grave risk if substantial Federal cuts are enacted.”
Medicaid provides health care coverage for about 80 million low-income Americans. Closely related, the Children’s Health Insurance Program (CHIP) extends coverage for children in families with incomes too high to qualify for Medicaid but too low to afford private health insurance coverage. Both programs are funded jointly by states and the federal government and are managed by states under federal rules.
“Medicaid is the backbone of many aspects of our health care system, including paying for the majority of nursing home residents, covering 40 to 50% of children and births nationwide, depending on where you live, covering people with disabilities and many other low income people,” Alker said.
Medicaid’s rural footprint
The report looks at 2023 federal census data to estimate the share of urban as well as rural and small town residents covered by Medicaid and CHIP. The data source, the American Community Survey, is useful for comparisons among states but may undercount Medicaid enrollment, Alker said, making the report’s estimates conservative.
In 40 out of 48 states, the report finds, Medicaid enrollment in rural counties was similar to or higher than in urban counties. (The report defines a rural county as one with no urban communities of 50,000 people or more. New Jersey, Rhode Island and the District of Columbia have no designated rural counties.)
Medicaid and CHIP covered more than half of all children living in rural areas and small towns in six states: New Mexico, Louisiana, Arizona, Florida, South Carolina and Arkansas.
Ten states had the largest difference between rural and urban children in the programs. Arizona headed that list, with 55.9% of rural or small town children enrolled in Medicaid or CHIP compared with 34.9% of children in metro areas.
Among all states, Texas had the largest number of children — 239,100 — enrolled in Medicaid or CHIP, followed by North Carolina, with 237,800; Georgia, with 205,200; and Kentucky, with 199,200.
Higher rural Medicaid enrollment also showed up among adults. In 15 states at least 20% of rural or small-town adults ages 18 to 65 were covered by Medicaid. Arizona again headed the list, with 35.9% of rural non-elderly adults enrolled in the program compared with 16.8% of urban adults.
“Medicaid is protecting families and people from exposure to high medical costs, and Medicaid is very good at that,” Alker said. “Cuts to Medicaid, which is already a very lean payor in our health care system, will result in transferring costs, shifting costs to families and providers cutting services and in rural communities,” Alker said.
Wisconsin patterns
Overall, Medicaid coverage is highest in urban Milwaukee County (27.4%) and rural Menominee County (29.9%). On average, Medicaid covers about 15% of Wisconsin adults under 65, rural and urban alike, and Medicaid or CHIP cover about one-third of children on average, whether they live in urban or rural communities.
In 27 rural counties across northern and central Wisconsin, however, the share of children on Medicaid is higher than the state average.
“Nearly 1.5 million Wisconsin residents live in rural areas and small towns, and Medicaid plays a critical role in ensuring access to health care for these communities,” said William Parke-Sutherland of Kids Forward. “Congress is considering enormous funding cuts to Medicaid in the year ahead, and this new report confirms how disastrous this would be for our rural communities and small towns.”
Rural patients and providers alike count on Medicaid to support the health care infrastructure and provide health care services, providing preventive care, dental care and behavioral health services, according to Ana Tochterman, CEO of NorthLakes Community Clinic, a federally supported health clinic with facilities across northern Wisconsin.
“Medicaid is an absolutely essential program that provides insurance for the majority of patients served at our rural Community Health Center,” Tochterman said. “Rural patients face unique challenges like transportation barriers and limited access to resources found in larger communities, and Medicaid is an important tool that enables rural patients to thrive.”
Rural health and resources
The report identifies several health care challenges for rural areas. Those include a greater scarcity of providers, limited internet connectivity and longer distances between people and their health care providers, exacerbated by a lack of public transportation.
Medicaid cuts could threaten already-shrinking rural health care networks, the report warns. “Health care systems are already under enormous pressure and can ill afford any loss of resources,” Alker said.
Care for mothers and newborns is especially likely to suffer, said , a health policy researcher at the University of Minnesota who has studied hospital and delivery room closures.
In 2010, more than 43% of rural hospitals and almost 30% of urban hospitals didn’t offer obstetric care, she said. By 2022, that was true of more than 52% of rural hospitals and more than 35% of urban hospitals.
“More than a decade into a maternal health crisis in the United States, fewer U.S. hospitals provide obstetrics every year, with rural hospitals experiencing the greatest losses,” Kozhimannil said.
The high cost of specialized facilities and staff to deliver babies have to be covered by revenues that vary depending on how many children are born each year and how much the hospital gets paid for each birth, she explained. Those factors put a bigger burden on smaller hospitals and on hospitals with more Medicaid patients, because Medicaid usually pays less than private health insurance.
Beside care at and before birth, she added, Medicaid can make it possible for families to get health care for children growing up with special health needs, mental health care or substance abuse treatment for teens, or long-term care for the elderly.
“These are all areas of deep need in our rural communities that are disproportionately financed through Medicaid programs,” Kozhimannil said.
‘A crucial backstop’
Hutchinson Regional Medical Center in central Kansas serves a population of about 100,000 people, but its service area extends into Western Kansas.
“Our health system, which cares for that region, is sustained largely, or in part, by Medicaid,” Benjamin Anderson, the medical center’s CEO, said during the Georgetown press briefing.
He mentioned a baby born earlier this week at the hospital whose mother never had access to prenatal care. The infant will now spend months in the facility’s neonatal intensive care unit, incurring health care expenses likely to top $1 million.
“Much of that would have been preventable with adequate prenatal care,” Anderson said.
Maternal and child health is a major part of the facility’s mission, “but older adults, too, are also cared for by moms and they are also particularly vulnerable,” he added. “Cuts to Medicaid mean fewer providers, and just speaking very plainly, fewer providers are able to sustain receiving patients that have Medicaid. Fewer poor people will be able to access care at a health system like ours that takes all payers — and those who can’t pay — and is currently operating at break even.”
The COVID-19 pandemic put health care systems into a metaphorical intensive care unit and “we’re still recovering,” Anderson said — striving to address needs ranging from maternity care to seniors who need long-term care, perhaps at home in the face of nursing home bed shortages.
“Medicaid is a crucial backstop for that to happen, and it’s so important that we sustain it, that we prop it up,” Anderson said. “We have an opportunity to rebuild a system right now, and there are many in this country that are doing that following the pandemic. And significant cuts, as are identified in this report, would cripple those efforts to recover.”
GET THE MORNING HEADLINES.