Hidden Costs of Senate Health Care Bill: Uninsured Kids Do Worse in School, More Likely to Drop Out

Senate Republicans unveiled their proposal to repeal Obamacare this week after weeks of secretive negotiations. While the plan would bring significant changes to insurance markets, the focus on cost analyses and political speculation has overshadowed a crucial aspect of the story: the impact of unraveling Obamacare on K-12 students and the potential threat to their academic achievements.

When House Republicans narrowly passed their own version of the repeal in May, examined the potential costs that states would bear if federal Medicaid funding, which was greatly expanded under Obamacare, was rolled back. Alarming findings from the progressive Center on Budget and Policy Priorities revealed that school districts could face competition with doctors and hospitals for the limited remaining funds. This could result in austerity budgets that do not have sufficient resources to support services like speech and occupational therapy, mental health counseling, and other essential programs that are currently funded through Medicaid.

The upcoming legislation, which is expected to be voted on next week, maintains the House bill’s drastic cuts to Medicaid, which currently provides approximately $4 billion each year to school districts. These funds serve as a crucial supplement to the chronically underfunded revenue streams from the Individuals with Disabilities Education Act. However, Medicaid is not the only component of the GOP’s repeal efforts that will impact schools.

Since the enactment of Obamacare in 2010, the number of uninsured American children has significantly declined. Some children gained coverage through enhanced Medicaid programs, while others obtained insurance through the newly established state exchanges. If congressional Republicans eliminate the funding for both of these initiatives, the Urban Institute predicts that around 4.4 million children could lose their insurance coverage by 2019.

Apart from the public health consequences of this development, the academic ramifications could be substantial. Numerous studies indicate that access to early medical care through insurance programs like Medicaid leads to improved academic outcomes and future life success. For example, a 2014 paper from the National Bureau of Economic Research found that expanding Medicaid eligibility for children could reduce the risk of high school dropout by 6 percent and increase the likelihood of college completion by 3 percent.

The authors of the study concluded, "Our estimates suggest that the long-term benefits of providing health insurance access to children are greater than the short-term improvements in health status. Additionally, these expansions can contribute to a reduction in inequality and promote higher economic growth by creating a more skilled workforce."

While these findings may not be surprising, it is crucial to recognize that uninsured children do not perform as well in school compared to their peers who have access to regular medical care. In the ongoing debate about the government’s role in providing insurance to the public, the impact on uninsured children’s educational outcomes has often been overlooked.

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