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Fact Sheet
October 2009

Medicaid and the Children’s Health Insurance Program (CHIP) Soften the Blow during Tough Economic Times

Recent Census data reveal that Medicaid and CHIP have served as an effective health care safety net for many newly uninsured and impoverished families. These programs have greatly softened the blow of the recession and offset some of the losses in job-based coverage, working especially well for low-income children (for whom eligibility levels are generally higher than the eligibility levels for their parents).

However, Medicaid in its current form cannot help all of the low-income people who have been affected by the recession, for two reasons: many states set their Medicaid eligibility levels for parents at extremely low levels; and in 42 states, adults without dependent children are not eligible for Medicaid, regardless of their income. 

Without health reform, millions of low-income families will continue to fall through the cracks in our health care system, adding to the ranks of the uninsured. Enacting national health reform will likely raise the Medicaid eligibility level to 133 percent of poverty for all Americans, helping states close the holes in the health care safety net so that all low-income people have access to high-quality, affordable health care.