Children's Hospital Colorado

Medicaid Overview and Potential Restructure

Frequently asked questions

1. What is Medicaid?

Medicaid is a joint federal and state program that helps with medical costs for some individuals with limited income, disabilities or need for long-term care. Medicaid provides health coverage to millions of Americans, including eligible low-income adults, children, pregnant women, elderly adults and people with disabilities. Medicaid is administered by states, according to federal requirements, and responsibility for funding the program is shared between states and the federal government.

2. How many children rely on Medicaid?

More than 30 million children nationwide rely on Medicaid for health insurance coverage. Many are families with low incomes who do not have access to or cannot afford commercial insurance for their children. Others are covered by commercial insurance but have serious, chronic medical conditions that require regular and ongoing therapies and specialized care covered by Medicaid.   

3. What is Children’s Colorado’s position on cuts to Medicaid?

Medicaid is the single most important healthcare program for children in America, and we believe indiscriminate cuts to Medicaid will hurt children disproportionately. Children are already the lowest funded population group in the federal budget. As Congress considers the future of Medicaid, any potential reforms must protect the unique needs of children.

Further, cuts to Medicaid by lawmakers in Washington D.C. will simply shift the costs from the federal government to states, providers, families and patients. In particular, so-called “block grants” or “per capita caps” would put state budgets at risk if Medicaid costs go up—as happens during recessions or natural disasters. This would make it hard for states to deal with competing priorities like education or transportation.

4. How would broad Medicaid cuts disproportionately hurt children?

Half of the nation’s children, some 36 million, are provided healthcare through the Medicaid (30 million) and CHIP (6 million) programs. Our country needs these children to grow up to become the healthy adults who will drive our future economy, workforce, security and communities.

Of the 74 million beneficiaries in the Medicaid and CHIP programs, nearly 50% are age 0-18. Current proposals to reduce federal spending in Medicaid would cut support for children’s healthcare, putting their health at risk.

5. How much do children cost relative to other Medicaid beneficiaries?

Children are the lowest funded population in Medicaid and in the federal budget as a whole. Children account for nearly half of Medicaid enrollees, but only about 20% of the costs. 

6. How is Medicaid an investment in our future?

Medicaid is an investment in our nation’s security and our future, covering the children who will grow to be the next generations of our nation’s business, community and military leadership. Compared to the uninsured, children on Medicaid are healthier and go on to achieve higher educational and economic outcomes as they become adults.

Medicaid provides for essential elements that must be protected and strengthened, including pediatric-specific benefits. Ensuring kids have access to the care they need is the right thing to do, but it’s also a wise and necessary investment in our future as a nation.

7. What are the core components of Medicaid for children?

Children covered by Medicaid benefit from essential program elements designed specifically for them. We believe that the following need to be maintained and strengthened in the upcoming healthcare debates:

  • Coverage: Medicaid and the Children’s Health Insurance Program (CHIP) together cover more than 36 million children. Coverage levels must be maintained as the uninsured rate for kids has hit an historic low of 5%.
  • Benefits: Children’s healthcare benefits are defined by national standards at the Early and Periodic Screening, Diagnostic and Treatment (EPSDT) benefit level. The EPSDT benefit is a proven standard for children based on their unique healthcare needs and should represent the minimum benefit definition.
  • Access to care: Medicaid payments to providers should be sufficient and predictable to ensure children receive necessary care. Financial personal responsibility for Medicaid coverage should not be applied to children. The current levels of premiums and cost-sharing outlined in the Medicaid law are appropriate since children generally do not work or have full financial responsibility.
  • Financing: Any financial restructuring must consider the essential elements of Medicaid for children and the impact of limiting investments on their health. Reforms must ensure children’s funding is stable, clearly defined, includes all current funds and services, and provides for an annual escalator that will maintain today’s services and remediate shortages in mental and behavioral health services.
  • Innovation: Children should have the opportunity to participate in innovations that improve quality and reduce costs, such as the Advancing Care for Exceptional Kids Act (ACE Kids Act). Over time, the federal government has focused more on the needs of children in innovative reforms, but Medicaid for children still lags behind Medicare in supporting improvements in care.
  • Data: Better national data will enhance efforts to improve the program for children and ensure the resources provided are used most effectively and efficiently. Currently, there is no consistent way to track children’s healthcare outcomes and costs across states.

8. What is the current state of children’s health, and where are the major gaps?

We have made progress on children’s health through investments in programs like Medicaid and CHIP that have shown better health and educational outcomes for children and the country as a whole, relative to children who lack health insurance. But we need to do better. Mental health coverage and benefits, in particular, are lacking. 

Children need continued support to ensure they have coverage that meets their needs and receive necessary care. Strengthening support for children in their early years will improve the future lives of all children in the program, and as a nation, ensure we stand behind the sickest children and their families.

9. What does EPSDT mean, and why do we need the federal requirement?

The Early and Periodic Screening, Diagnostic and Treatment (EPSDT) is a required benefit for children under Medicaid. Simply put, it means that children can get care that is deemed medically necessary by a physician. EPSDT ensures coverage of well-child care and immunizations, along with periodic screenings and needed treatments. This minimum federal standard is necessary so that states facing budget shortages don’t balance their books by cutting these essential services for children.

10. What is Children’s Hospital Colorado’s position on block grants and/or per capita caps?

As Congress considers any Medicaid reforms, we must protect the unique needs of children under any policy concept. We have serious concerns that fundamental changes to the financing of Medicaid—such as capping or limiting federal support, or removing proven benefit concepts such as EPSDT—could unintentionally jeopardize kids’ coverage, benefits or access to care.

Like any program, Medicaid has room for improvements, and we are actively supporting one proposal in Congress to improve Medicaid for the kids who need it most. But we do not support arbitrary cuts in federal spending that push costs to the states without the elements essential to advancing children’s healthcare.

Our asks to Congress

  1. As we secure Medicaid for children in the short-term, we ask Congress to create a formal bipartisan process to work with pediatric healthcare experts to reform and improve Medicaid moving forward. We must work together to lower costs and improve our systems of care for children, especially in early childhood development and mental health.
  2. Protect children in the Medicaid budget. Of federal Medicaid spending, the children’s share ($67 billion) is less than 20% of the total Medicaid budget; the balance is spent on adults. Children are already the lowest funded population group in the federal budget. We must protect this investment now and work to advance solutions to improve care and reduce costs moving forward.
  3. Ensure any final healthcare reforms include these “must haves” for children:
    • Coverage and access for all children. All eligible children must be covered by Medicaid and CHIP and able to access the services required, particularly in their immediate prenatal and early years of life.
    • Child-specific health benefits. All children covered by Medicaid and CHIP should receive current national pediatric standard EPSDT benefits, regardless of the state they live in.
    • Care for the sickest children. Fewer than 5% of children have healthcare needs requiring specialized care at regional centers that may be outside their home state. Their care is already expensive and hard on families, and we must not increase their burden, as would likely happen under drastic Medicaid cuts. Instead, we are working to advance new solutions such as the ACE Kids Act (an option for the sickest kids) and related initiatives.

How can I get involved?

  1. Learn about our position on the Affordable Care Act (ACA) and potential Medicaid cuts.
  2. Sign up for Child Health Champions to stay informed, receive regular updates, and get action alerts that make it easy to speak up on behalf of kids.
  3. Contact your legislator and urge them to keep kids top of mind when making health policy decisions.
  4. Email us at with any additional questions.

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