Medicaid and Fiscal Federalism During the COVID-19 Pandemic / Jeffrey Clemens, Benedic N. Ippolito, Stan Veuger.

Format:

Book

Author/Creator:

Clemens, Jeffrey.

Contributor:

National Bureau of Economic Research.

Ippolito, Benedic N.

Veuger, Stan.

Series:

Working Paper Series (National Bureau of Economic Research) no. w28670.

NBER working paper series no. w28670

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2021.

Summary:

We analyze the effects of the COVID-19 pandemic on state and local government finances, with an emphasis on health spending needs and the role of the Medicaid program. We arrive at three conclusions. First, we find that nationwide, and over the entirety of the federal budget window, the enhanced federal matching funds are of roughly the same magnitude as expected increases in state Medicaid costs. There is a difference in timing, however, as projected relief funds are more concentrated in the near term than projected spending needs. Second, we show that there is substantial variation in states' exposure to increases in Medicaid program costs. Third, we evaluate the extent to which federal aid has been targeted at states with large increases in Medicaid costs. We show that the enhanced Medicaid matching funds are quite weakly correlated with variations in states' cost increases. In contrast, the state aid formula in the American Recovery Plan Act appears, to at least a moderate degree, to direct dollars toward states with large increases in their Medicaid enrollments.

Notes:

Print version record

April 2021.