As the United States emerged from the COVID-19 pandemic, the federal government began scaling back a critical financial lifeline that had temporarily shielded millions from losing their health insurance coverage. This lifeline came in the form of enhanced Medicaid funding implemented during the pandemic, which allowed all Medicaid enrollees to maintain their benefits regardless of changes in eligibility. With the conclusion of this federal support in March 2023—a process now widely termed the “great unwinding”—states were compelled to reassess their Medicaid rolls, leading to the disenrollment of over 25 million individuals nationwide. This dramatic reduction, roughly representing 30 percent of the Medicaid population, ignited concern about the subsequent ripple effects on health care delivery, particularly among vulnerable pediatric populations.
In a pioneering study published in Health Services Research, investigators from Texas A&M University, in collaboration with research partners from the University of Alabama and Penn State University, have conducted an extensive analysis of how this policy reversal reshaped the payer landscape for emergency department visits among children in Texas. The research harnessed an expansive dataset comprising 7.6 million pediatric emergency visits across 472 emergency departments, spanning the period from April 2021 through May 2024. This longitudinal approach allowed the authors to capture baseline conditions preceding the unwinding and to chronicle the consequential evolutions in health insurance coverage status amid this unprecedented transition.
Dr. Daniel Marthey, a health policy expert and lead author of the study, emphasizes the critical nature of understanding payer dynamics in health care institutions, noting that the source of payment—be it Medicare, Medicaid, private insurance, or out-of-pocket by uninsured patients—bears profound implications for hospital financial health. Indeed, commercial insurance typically reimburses at higher rates compared to public programs such as Medicaid, while providing care to uninsured patients imposes significant uncompensated care costs, exacerbating financial strain on already challenged health facilities.
The findings document a notable shift in the pediatric emergency department payer mix in the wake of Medicaid disenrollments. Specifically, the share of visits covered by Medicaid shrank by 7.2 percentage points, equating to an 11.7% relative decrease from baseline. Simultaneously, the proportion of children covered by commercial insurance surged by 12.5%, while visits by uninsured children rose dramatically by 45.2%. This bifurcated trend underscores a complex transition: while some families may have secured alternative private coverage, a substantial fraction found themselves without any form of health insurance.
Temporal analysis reveals intriguing patterns in this shift. Immediately following the unwinding, increases in commercial insurance coverage were prominent, indicating a degree of rapid substitution or acquisition of employer-sponsored or marketplace plans among affected families. Conversely, the ascent in uninsured emergency visits exhibited a more gradual, sustained upward trajectory over time, reflecting possibly lingering challenges in coverage access or affordability for certain populations. Such disparities highlight nuanced challenges in health insurance transitions during periods of policy change.
Benjamin Ukert, PhD, co-author of the study, underscores the serious financial repercussions that rising rates of uninsured pediatric emergency visits engender for hospitals and state health budgets alike. Although the increased prevalence of commercially insured visits can partially mitigate revenue losses due to decreased Medicaid utilization, uncompensated care burdens remain an acute concern, with potential calls for augmented support or subsidies from state agencies to buffer affected institutions. The fiscal stability of health facilities, particularly in resource-constrained rural settings, hangs in the balance amid these evolving insurance landscapes.
Indeed, small rural hospitals have borne the brunt of these shifts, experiencing the steepest declines in Medicaid patient visits alongside the most pronounced surges in uninsured cases. These hospitals often serve as critical safety nets in medically underserved regions. Their already narrow or negative profit margins render them vulnerable to closure if uncompensated care demands escalate unchecked. Such closures would not only imperil access to emergency services but could cascade into broader public health crises for rural communities.
The study’s quantitative estimates suggest a paradoxical fiscal outcome: despite the substantial decrease in Medicaid-covered pediatric emergency visits, the increased proportion of visits reimbursed by commercial insurers may have nearly offset the resultant revenue deficits. However, this financial equilibrium does not account for the amplified costs associated with managing higher volumes of uninsured patients or other indirect economic pressures. Consequently, hospitals navigating this altered payer environment face complex financial calculus and operational challenges.
Beyond fiscal ramifications, the healthcare consequences for children losing Medicaid coverage are profound. The loss of comprehensive health insurance may precipitate delays or forego routine and preventive care, thereby elevating the likelihood of emergent health crises requiring emergency intervention. This is particularly concerning for children with chronic conditions such as asthma—over 500,000 in Texas alone—who depend on continuous care to manage symptoms and avoid exacerbations. Disruptions in access increase the potential for more frequent and severe emergency visits, straining healthcare resources even further.
Policy implications derived from this work resonate strongly with healthcare advocates and state policymakers. The findings signal an urgent necessity for strategies that facilitate smoother transitions for pediatric populations exiting Medicaid programs. Such policies might include enhanced enrollment assistance, expanded eligibility for alternative public programs, or bolstered subsidies for private insurance acquisition, all targeted toward minimizing coverage gaps and safeguarding access to essential care.
Dr. Marthey cautions against overgeneralizing these findings, given Texas’s unique demographic and Medicaid policy landscape. Differences in Medicaid eligibility criteria, enrollment processes, and insurance market dynamics across states suggest that other regions may experience variant outcomes in payer mix shifts following Medicaid unwinding. Nonetheless, this study provides a critical lens into potential national trends and a foundation for comparative analyses.
The comprehensive nature of this study, incorporating a vast dataset and multidisciplinary research collaboration, adds substantial weight to its conclusions. By examining pediatric emergency encounters—a vital and often urgent setting for healthcare provision—the research shines a light on how macro-level policy changes reverberate through frontline health services. This nuanced understanding empowers stakeholders to better anticipate and address the evolving healthcare needs and economic hurdles faced by both providers and patients in a post-pandemic landscape.
As federal and state governments confront the ongoing challenges of health insurance coverage and access, the insights from this research underscore the intricate interplay between policy, payer dynamics, and healthcare delivery outcomes. With millions of children navigating uncertain insurance futures, the balancing act of maintaining financial viability for hospitals while ensuring equitable care access remains a paramount concern. The “great unwinding” serves as a cautionary tale and call to action for a more resilient and inclusive health insurance infrastructure that protects vulnerable populations through policy transitions.
Subject of Research: Changes in Emergency Department Payer Mix Among Children Following Medicaid Unwinding in Texas
Article Title: Changes in Emergency Department Payer Mix Among Children Following Medicaid Unwinding in Texas
News Publication Date: 30-Jul-2025
Web References:
http://dx.doi.org/10.1111/1475-6773.70023
References:
Marthey, D., Ukert, B., Dague, L., et al. (2025). Changes in Emergency Department Payer Mix Among Children Following Medicaid Unwinding in Texas. Health Services Research. DOI:10.1111/1475-6773.70023
Keywords:
Health care costs, Health care delivery, Emergency medicine, Health care policy, Medical facilities, Hospitals, Human health, Public health, Health insurance, Pediatrics, Rural populations
