Medicaid Expansions and Welfare Contractions: Offsetting Effects on Prenatal Care and Infant Health?

PWP-CCPR-2000-003

Abstract

Evaluations of changes to the Medicaid program have focused on increases in the generosity of income
cutoffs for Medicaid eligibility. Previous research shows that despite dramatic increases in the number of births
paid for by the Medicaid program, many eligible women are still getting inadequate prenatal care. A common
pattern is for high risk women to enroll in Medicaid at the point of birth rather than before. States have
addressed this problem by adopting administrative measures designed to simplify the Medicaid application process
and encourage the use of prenatal care. At the same time, recent declines in welfare caseloads may have caused
many women to lose their Medicaid coverage by effectively increasing administrative barriers to obtaining care.

We examine the effects of these three factors (changes in income eligibility, administrative reforms, and
changes in welfare caseloads) on the use of prenatal care and infant health using data from birth certificates
covering all U.S. births between 1990 and 1996. We find that increases in income cutoffs were associated with
increased use of prenatal care, while decreases in welfare caseloads were associated with reduced use of prenatal
care, especially among blacks. The administrative reforms we consider had little effect. The changes in the
utilization of prenatal care that were induced by increases in income eligibility cutoffs and decreases in welfare
rates led to small but statistically significant reductions in the incidence of very low birthweight among whites.