The authors examine the relationship between the Medicaid eligibility expansions for children and state Medicaid spending during the period from 1984 to 1994. They find that the Medicaid expansions had relatively low incremental cost per enrollee—substantially below the average Medicaid expenditure for children. Expansion children tend to be older and have fewer disabilities. Moreover, many of the most expensive expansion children would have been covered by Medicaid-medically-needy provisions had the expansions not occurred. The authors examine the implications of our findings for intensified Medicaid outreach efforts and for the State Children’s Health Insurance Program.
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