In this episode of Listening In (With Permission), Andréa connects with Kristof Stremikis, Director, Market Analysis and Insights at the California Healthcare Foundation, for a candid exploration of Medicaid’s evolving landscape and its surprising relevance to the employer-sponsored insurance market.
Stremikis, whose work centers on improving healthcare for lower-income Californians, offers an insider’s perspective on the major federal changes looming over Medicaid—and what they could mean for states, providers, and employers across the country. From the mechanics of “churn” between Medicaid and employer coverage to the ripple effects of funding cuts, this conversation unpacks the complexities behind the headlines and makes a compelling case for why every benefits leader should be paying attention.
Key Insights
Medicaid and Employer Coverage: More Connected Than You Think
Stremikis explains that Medicaid isn’t a static program—millions of Americans move between Medicaid and employer-sponsored insurance each year. In California alone, about one-third of Medi-Cal enrollees transition to employer coverage annually. The quality and continuity of care these individuals receive in Medicaid directly impacts their health—and the costs—when they join employer plans.
Federal Policy Shifts: What’s on the Table
Major changes are being debated at the federal level, including new work requirements for beneficiaries, stricter eligibility redeterminations, and significant reductions in supplemental payments to providers. If enacted, these reforms could slash federal Medicaid funding by $800 billion over the next decade—roughly 10% of projected spending.
States Face Tough Choices
With less federal money, states will be forced to make difficult decisions:
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Reduce eligibility, meaning fewer people covered by Medicaid
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Cut benefits, eliminating services like dental or transportation
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Lower provider payments, threatening the stability of hospitals and clinics—especially in regions where Medicaid is the primary payer
Why Employers Should Care
Stremikis highlights two critical reasons:
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Population Health and Workforce Readiness: Employees often move between Medicaid and employer plans. Gaps in coverage or reduced benefits can lead to higher costs and worse outcomes for employers down the line.
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System Stability: In many communities, Medicaid dollars keep hospitals and clinics afloat. Cuts to Medicaid funding can destabilize entire healthcare systems, impacting access and quality for everyone—including those with private insurance.
The Bottom Line
Medicaid may seem distant from the world of employer benefits, but the connections are real—and growing. As federal policy debates unfold, employers have a stake in advocating for a robust, stable Medicaid program that supports population health, system sustainability, and a healthier workforce.
Why Listen?
Whether you’re a benefits manager, policy analyst, or simply curious about how public programs shape the broader healthcare market, this episode delivers a clear-eyed look at the stakes ahead. Stremikis’s perspective is practical and timely: understanding Medicaid’s future isn’t just a public policy concern—it’s a business imperative.
Resources and Thought Leadership from California Health Care Foundation:
- Lessons from the Medi-Cal Unwinding: How California Protected Coverage and Policy Options to Improve Renewals
- Medicaid Is One of America’s Strongest Economic Engines. Why Don’t We Treat It That Way?
- Federal Medicaid Cuts Would Devastate Health Care Systems in California’s Vast Rural North