As Medicaid Shrinks, Clinics for the Poor Are Trying to Survive

TYLER, Texas — Appointment cancellations and financial distress have become a constant at Bethesda Pediatrics, a nonprofit medical clinic in East Texas that is heavily dependent on Medicaid, the health insurance program for the poor.

The uncertainty and panic at the clinic, tucked inconspicuously in a poor residential pocket of Tyler, Texas, highlight a little-examined consequence of the vast trimming of the Medicaid rolls since a policy during the pandemic that banned states from kicking anyone out of the program ended last spring. The loss of coverage has not only affected families but is also threatening the financial stability of vital components of the American safety net.

Medicaid payments are “the lifeblood of our health centers and their ability to serve,” said Dr. Kyu Rhee, the president and CEO of the National Association of Community Health Centers, which treat roughly 1 in 11 people in the United States and rely on Medicaid and federal grants to provide a financial cushion for the uncompensated care they give uninsured patients.

Since last spring, Medicaid enrollment has dropped by almost 10 million, including around 4 million children, according to researchers at Georgetown University. States have removed people for a variety of reasons, including for changes in income and age. Some people have been dropped because they did not return paperwork. Others have lost coverage because of technical errors, including computer glitches.

The loss of reimbursements for millions of patients has contributed to an already difficult financial picture for facilities that treat the poor: Unless Congress reaches a funding agreement, nearly $6 billion for federally financed health clinics, which serve more than 30 million people, most of them low-income, could lapse in early March.

Those health centers have each seen revenue losses of at least $500,000 because of the Medicaid unwinding, according to Amy Simmons Farber, a spokesperson for the health center association.

The costs have been passed on to insurers and patients of all types, increasing out-of-pocket payments for everything from emergency room visits to hospital stays to routine doctor appointments, according to data from Epic Research.

Texas health officials have defended the unwinding as a natural reversion to Medicaid’s intended shape and size. Conservative health policy experts have also argued that shrinking the rolls is important to sustaining the program financially.

“The reality is that many health professionals cannot sustainably see Medicaid patients,” said Tanner Aliff at the conservative Texas Public Policy Foundation.

This article originally appeared in The New York Times .