Potential Expiration of Tax Credits and Medicaid Unwinding Threaten Progress in Health Equity

The Commonwealth Fund’s 2026 State Health Disparities Report presents a stark evaluation of the American health care landscape, revealing that racial and ethnic inequities remain a defining characteristic of health system performance in every state.¹ According to the report, findings indicate that even when income and insurance status are comparable, Black, Hispanic, and American Indian and Alaska Native (AIAN) populations continue to face significant barriers to high-quality care.

The data, which reflect performance through 2024, capture a critical inflection point. While recent years saw modest gains in coverage, the expiration of enhanced Affordable Care Act (marketplace) tax credits and the continued "unwinding" of Medicaid eligibility threaten to reverse these trends.

The Measurement of Inequity: Scorecard Methodology

The report utilizes 24 indicators across 3 primary domains: access to care, quality and use of health services, and health outcomes. Findings are stratified across 5 racial and ethnic groups: Asian American, Native Hawaiian, and Pacific Islander (AANHPI); AIAN; Black; Hispanic; and White.

Massachusetts demonstrates that near-optimal care is achievable for some populations, with White residents in the state earning a score of 99; the systemic failures for other groups remain stark. In that same state, Hispanic residents score 76 and Black residents score 58, highlighting that even in robust health systems, equity remains elusive.

Joseph Betancourt, MD, president of The Commonwealth Fund, emphasized the necessity of data-driven accountability during a briefing on the report. “You cannot fix what you cannot measure,” Betancourt stated, noting that current efforts to limit the collection of race and ethnicity data could leave policymakers blind to the specific populations being left behind.

"The disparities we are bringing into the spotlight today are not inevitable,” he said. “They're shaped by policy choices and health system decisions that can be changed."

In contrast to the high-performing Northeast, states like West Virginia and Mississippi recorded performance scores below 50 for every racial and ethnic group measured. This broad system failure indicates that in these regions, the health infrastructure is struggling to support even those populations that traditionally face fewer barriers.

Researchers assigned performance scores on a scale of 0 to 100 for each group within each state. While a score of 100 represents high performance, it does not imply a perfect system, as room for improvement exists across all metrics. The report found that in the majority of states, performance scores for Black and Hispanic residents fell significantly below the all-group median. This is increasingly relevant as state Medicaid programs shift toward managed care organization (MCO) contracts that include financial incentives for reducing these specific disparities.² By 2025, 37 states had implemented MCO requirements related to narrowing racial health gaps, up from just 16 in 2022.

The report identifies South Dakota as having one of the most alarming disparities in the nation regarding avoidable mortality.¹ For AIAN residents in the state, the rate of deaths before age 75 from treatable causes exceeds 1000 per 100,000 people. This stands in jarring contrast to Massachusetts, where the mortality rate for AANHPI residents is just 82 per 100,000. This disparity is further exacerbated by the continued "unwinding" of Medicaid eligibility, which has historically provided a critical safety net for these vulnerable populations.

Avoidable Mortality and the Coverage Gap

A primary metric of the report is avoidable premature death—mortality before age 75 from preventable or treatable causes, such as diabetes, certain cancers, and kidney disease.¹ The findings reveal that AIAN and Black populations bear the highest burden of avoidable death in nearly every state with available data.

In South Dakota, the avoidable mortality rate for AIAN residents exceeded 1000 deaths per 100,000 people. Conversely, AANHPI residents in Massachusetts experienced the lowest observed rate at 82 per 100,000.

These outcomes are inextricably linked to insurance coverage and affordability. Kristen Kolb, MPH, RN, a research associate at The Commonwealth Fund, noted that while uninsurance rates reached historic lows in 2021–2022 due to pandemic-era protections, those gains are now eroding. In 43 of 50 states, Hispanic adults were the most likely to report forgoing necessary medical care due to costs. In Tennessee, nearly 40% of the Hispanic population remains uninsured, compared with just 2% of White residents in the District of Columbia.

The Quality Disconnect: Screening vs Outcomes

The report highlights a troubling "quality disconnect" in clinical services. In 37 of 40 states, Black women experienced the highest rates of breast cancer mortality, despite often having higher screening rates than White women.

“Mammograms are covered at no cost under the ACA, but the follow-up tests and biopsies often involve significant cost-sharing,” Jess Maksut, PhD, director of Health Equity Research at The Commonwealth Fund, explained in the briefing.

This financial barrier, combined with potential provider bias and later-stage detection, contributes to a higher mortality rate even among those who seek preventive care. Recent analysis supports this, showing Black women have a 40% higher mortality rate than White women as of late 2024.³

Disparities were also noted in pediatric care.¹ In all but 8 states, Black and Hispanic children were less likely than White children to receive age-recommended preventive medical and dental visits. While federal programs like "Vaccines for Children" have successfully narrowed immunization gaps, experts expressed concern that shifting vaccine recommendations and policy uncertainty could jeopardize this progress.

"No state has eliminated racial and ethnic gaps in health care access, quality and health outcomes, and the size of racial and ethnic gaps vary widely, both between and across states,” Maksut said.

Policy Implications: A Roadmap for Equity

The report frames these disparities as the result of deliberate policy decisions rather than inevitable social factors. Laurie Zephyrin, MD, senior vice president for Achieving Equitable Outcomes at The Commonwealth Fund, outlined 5 key policy pillars aimed at narrowing these gaps:

1. Ensuring Universal Coverage: Zephyrin noted that the number of uninsured Americans is projected to reach 37 million by 2036 without intervention. Recommendations include extending enhanced marketplace tax credits and simplifying Medicaid enrollment.
2. Strengthening Primary Care: High-performing states tend to invest heavily in primary care infrastructure. Policymakers are encouraged to align payment models with value and incentivize care in underserved communities.
3. Protecting Preventive Services: Maintaining no-cost access to evidence-based screenings and vaccines is critical to preventing manageable conditions from becoming crises.
4. Addressing Social Determinants: Programs such as the Supplemental Nutrition Assistance Program (SNAP), affordable housing, and transportation supports are estimated to influence up to 80% of health outcomes.
5. Equitable Innovation: As artificial intelligence becomes integrated into health systems, Zephyrin emphasized the need for transparency and bias testing to ensure technology narrows rather than widens existing gaps.

"Coverage is critical, but it's the floor,” Zephyrin said. “It's not sufficient on its own, but it's critically important. Studies have shown that the social drivers of health account for as much as 80% of health outcomes."

As health systems move toward more data-intensive management, Betancourt emphasized that states must resist efforts to limit the collection of demographic data. Without these metrics, the nuanced differences in state performance—such as the "Hispanic health paradox" observed in Arkansas, where outcomes remain strong despite poor quality rankings—cannot be properly understood or addressed.

Regional Nuance and the "Hispanic Paradox"

The Q&A session highlighted specific regional challenges. In Arkansas, for example, Hispanic residents rank 50th in quality and 49th in access, yet 6th in health outcomes. Betancourt identified this as the "Hispanic health paradox," potentially driven by a younger age profile and protective social factors like family cohesion, though he warned that these outcomes may decline as the population ages without better access to care. Additionally, researchers warn this "immigrant health advantage" often erodes over time as acculturation increases and protective social factors, such as family cohesion, are offset by low socioeconomic status and rising rates of chronic disease.⁴

The report also highlights that social drivers of health, such as housing and nutrition, can account for up to 80% of health outcomes.¹ New predictive models are increasingly incorporating these data; recent Medicare fee-for-service claims analysis found that Black and older beneficiaries frequently have higher risk scores for severe complications, such as those related to diabetes, due to these underlying factors.⁵

Sara Collins, PhD, senior scholar and vice president for health care coverage and access at The Commonwealth Fund, addressed the impact of Medicaid expansion, noting that non-expansion states continue to see the widest racial and ethnic gaps in coverage.¹ David Radley, PhD, senior scientist, The Commonwealth Fund, added that in rural areas like South Dakota, coverage must be paired with investments in health system infrastructure and community health workers to be effective.

The 2026 report underscores that health equity is a shared system problem. As Zephyrin concluded, "Disproportionate access doesn't just affect those most marginalized. That means failed systems that really impact everyone."

"States with stronger overall health system performance really tend to do better on disparities, and this report points to practical priorities like stable coverage, strong primary care, and no cost, evidence-based preventative services," she said.

The findings serve as a critical tool for local and federal leaders to recognize that while the US health care system has the capacity for high performance, that performance remains unevenly distributed by design. Closing these gaps will require sustained policy intervention focused on coverage, quality, and the social drivers of health.

References

1. Maksut J, Radley DC, Kolb K, Collins SR, Zephyrin LC. The Commonwealth Fund 2026 state health disparities report. The Commonwealth Fund. April 29, 2026. Accessed April 28, 2026. https://www.commonwealthfund.org/publications/fund-reports/2026/apr/commonwealth-fund-2026-state-health-disparities-report
2. Santoro C. Medicaid budget survey highlights postpandemic challenges and priorities. AJMC^®. October 24, 2024. Accessed April 29, 2026. https://www.ajmc.com/view/medicaid-budget-survey-highlights-postpandemic-challenges-and-priorities
3. McCrear S. The breakdown: breast cancer research awareness day. AJMC. August 19, 2025. Accessed April 29, 2026. https://www.ajmc.com/view/the-breakdown-breast-cancer-research-awareness-day
4. Santoro C. Diabetes risk driven by economic disparity in Hispanic, Latino communities. AJMC. March 28, 2025. Accessed April 29, 2026. https://www.ajmc.com/view/diabetes-risk-driven-by-economic-disparity-in-hispanic-latino-communities
5. Goetschius L, Barefoot D, Han F, Ruichen S, Henderson MA. Predicting severe diabetes complications using administrative claims data in Maryland. Am J Manag Care. 2026;32(3):e66-e70. Accessed April 29, 2026. https://www.ajmc.com/view/predicting-severe-diabetes-complications-using-administrative-claims-data-in-maryland