The Unintended Impact of Welfare Reform on the Medicaid Enrollment of Eligible Immigrants

As part of welfare reform, Congress barred legal immigrants who entered the United States after August 1996 from Medicaid for five years after immigration. This study compares the Medicaid enrollment of U.S.-born citizens to pre-1996 immigrants, before and after welfare reform, to see if reform policies had the unintended impact of deterring Medicaid enrollment of pre-1996 immigrants. Using cross-sectional data from the 1994-2001 U.S. Census Bureau, Annual Demographic Survey of March Supplement of the Current Population survey, low-income, U.S.-born adults (n=116,307) were compared to low-income pre-1996 immigrants (n=24,367).

Key Findings:

  • Before welfare reform, pre-1996 immigrants were less likely to enroll in Medicaid than the U.S.-born.
  • After welfare reform, pre-1996 immigrants were even less likely to enroll in Medicaid. Federal laws to limit Medicaid eligibility of post-1996 immigrants appear to have had unintended consequences on enrollment in the larger, still eligible immigrant community.
  • Except for California, state variation in Medicaid policy toward post-1996 immigrants did modify the effect of welfare reform on pre-1996 immigrants.