Medicaid Costs and Birth Outcomes: The Effects of Prenatal WIC Participation and the Use of Prenatal Care

This study examines the effects of prenatal WIC participation and the use of prenatal care on Medicaid costs and birth outcomes in five states—Florida, Minnesota, North Carolina, South Carolina, and Texas. The study period is 1987 for Florida, Minnesota, North Carolina, and South Carolina and January-June 1988 for Texas. Prenatal WIC participation was associated with substantial savings in Medicaid costs during the first 60 days after birth, with estimates ranging from $277 in Minnesota to $598 in North Carolina. For every dollar spent on the prenatal WIC program, the associated savings in Medicaid costs during the first 60 days ranged from $1.77 to $3.13 across the five states. Receiving inadequate levels of prenatal care was associated with increases in Medicaid costs ranging from $210 in Florida to $1,184 in Minnesota. Prenatal WIC participation was associated with higher newborn birthweight, while receiving inadequate prenatal care was associated with lower birthweight.