Officials project sharp drop in Medicaid enrollment next year as unwinding continues

State Medicaid officials anticipate sharp enrollment declines and increases in state spending on Medicaid as pandemic-era policies further unwind, according to a KFF survey. 

Medicaid enrollment spiked to nearly 95 million Americans — an increase of more than 23 million people— between February 2020 and this April because of pandemic-related rules. In exchange for enhanced federal fund-matching, states couldn’t kick anybody off the program.  

But since those protections began ending this year, enrollment has slowed. 

The survey projected national Medicaid enrollment will decline by 8.6 percent in fiscal 2024, as states keep removing ineligible people from their Medicaid rolls. 

According to KFF, more than 10 million low-income people have lost coverage as of Nov. 8, based on the most current data from 50 states and the District of Columbia. More than 70 percent of those who lost coverage were removed because of “procedural” reasons such as missing paperwork or errors by state officials, raising concerns that many people who remain eligible for Medicaid may be losing coverage. 

At least 2 million children have lost health coverage during the “unwinding” period, though that number is likely a significant undercount because only 21 states report by age. 

Even though enrollment is falling, the survey found state spending is projected to increase by about 17 percent next year, largely because the additional federal financial assistance is being phased out, too. State spending grew by 13 percent in fiscal 2023. 

Medicaid represents $1 out of every $6 spent on health care in the U.S. and is the major source of financing for states to provide health coverage and long-term services and supports for low-income residents.