Why some disabled adults in Medicaid face large out-of-pocket expenses.

Using national survey data, we found that the Medicaid program effectively limits out-of-pocket health care spending for the majority of Medicaid enrollees who are disabled but are not in institutions, such as nursing homes. However, we also found that for 10 percent of these enrollees, annual out-of-pocket spending is $1,200 or higher--a significant sum for people who are low-income. Other research has shown that such cost barriers can deprive Medicaid enrollees of cost-effective care in favor of cost-ineffective care or no care at all. As state policy makers contemplate benefit reductions that could shift more costs to Medicaid enrollees, careful consideration must be given to the potential effects on this particularly vulnerable group.