Kroll Bond Rating Agency (KBRA) releases commentary on the impact to state budgets from increasing Medicaid enrollment, as the coronavirus (COVID-19) pandemic drives a historic rise in the U.S. unemployment rate.
While the majority of Medicaid spending growth is historically attributable to enrollment increases, the mix of enrollees also impacts spending. With most of the newly unemployed likely to be of working age (19-64) and relatively healthy compared to existing Medicaid populations across the U.S., per capita spending on these new enrollees is likely to be relatively low.
Growth in Medicaid enrollment due to the pandemic is likely to be greatest in the 37 Medicaid expansion states, as well as in states with multiple affected industries and those states experiencing the greatest number of coronavirus cases.
Despite the temporary 6.2% increase in federal Medicaid funding pursuant to the Coronavirus Aid, Relief and Economic Security (CARES) Act signed on March 27, 2020, surging Medicaid enrollment at a time of diminished state revenues will create long-term budgetary challenges.
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KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and is a certified Credit Rating Agency (CRA) with the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA. Kroll Bond Rating Agency Europe Limited is located at 6-8 College Green, Dublin 2, Ireland.
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