The recent rise in hardship highlights the need to prepare for financial emergencies. Even before the pandemic, many households lacked savings for unexpected expenses, retirement, or other goals; many households experienced financial problems from poor health, uninsurance, and/or medical expenses. Low-income and/or non-white households who, on average, have worse health and less wealth experienced these problems to greater degrees.
Uninsured or underinsurance, even after the ACA, and lack of savings threaten financial security. Medicaid is an important policy lever to improve well-being and may be critical for those near retirement but not yet Medicare-eligible. By examining state Medicaid eligibility rules and state-level rules related to categorical Medicaid eligibility for SSI recipients, we will test if Medicaid improves emergency savings and financial preparation for retirement before and during the COVID-19 pandemic for households headed by adults age 45 to 64. In addition to all households headed by adults near retirement, we will focus on three types of households nearing retirement: those in poor health, SSI recipients, and non-white households.
The outcomes we consider relate to the presence of emergency savings, retirement savings, and medical debt; responses to financial emergencies; beliefs about retirement adequacy; decisions to apply Social Security or SSI benefits; and, experiences of financial hardship. Whether Medicaid coverage affected the financial health of these households before and during the ongoing COVID-19 pandemic will inform how current and future Social Security beneficiaries will fare during retirement, as well as how these two important social programs relate to one another.