Raising the Minimum Wage in New Jersey: Implications for Earnings and Medicaid Eligibility and Enrollment

Brief

Raising the Minimum Wage in New Jersey: Implications for Earnings and Medicaid Eligibility and Enrollment

Abstract

New Jersey has enacted an incremental minimum-wage increase from $8.85 in 2019 to $15 by 2024. Though some workers could lose Medicaid eligibility under the wage increase, our findings suggest loss of Medicaid eligibility and coverage will likely be small relative to the number of workers likely to experience a wage increase. We find this minimum-wage increase would raise earnings for 810,000 nondisabled citizen workers in New Jersey. Of those workers, we estimate 250,000 are Medicaid eligible under the current minimum wage, but most of them are either not enrolled in Medicaid or will not gain enough income to lose their Medicaid eligibility under a $15 minimum wage. We estimate that 24,000 Medicaid-enrolled workers could have earnings that exceed the Medicaid income limit because of the minimum-wage increase. Our estimates show those at risk of losing Medicaid coverage constitute less than 5 percent of all nondisabled, nonelderly adult Medicaid enrollees in New Jersey. Moreover, we find that all workers losing Medicaid eligibility would be in the income range to qualify for subsidized coverage in the Affordable Care Act’s Marketplace.

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