WASHINGTON – The share of states’ own money spent on Medicaid health care coverage for low-income Americans slipped in 2015, even as enrollment grew during the second year of the program’s expansion under the Affordable Care Act.
States spent 16.7% of their own revenues on Medicaid in 2015, down from 16.8% in 2014 and 17% in 2012, according to
Pew looked at state Medicaid spending data from the Centers for Medicare & Medicaid Services.
“Even while millions of additional people were enrolled in the program, what states spent as a share of their revenue remained flat,’’ Matt McKillop, who authored the analysis, said Monday in an interview.
McKillop said the drop occurred in 26 states, 18 of which have expanded their Medicaid coverage under the Affordable Care Act.
The reason: the federal government covered 100% of the cost of expending Medicaid eligibility through 2016.
That’s already changing this year. And a dramatic reversal is being debated in Congress.
The 31 states that chose to expand Medicaid eligibility are bearing 5% of the additional cost for that expanded population in 2017, with their share expected to increase annually to 10% in 2020.
The Republican health care legislation that passed the House and a version being considered in the Senate would each shift the burden of costs even more to the states.
Moody’s Investors Service last month issued a negative credit profile for the state sector because of the increased burden of Medicaid costs they would have under the bill pending in the Senate. Similar warnings for public hospitals have been issued by ratings agencies because of their dependency on Medicaid payments.
The Senate bill would begin a Medicaid per capita allotment beginning in 2020 that would use 2016 as the base year. States would have the option of receiving federal Medicaid money as a block grant for non-expansion children and adults or only non-expansion adults, under the bill.
Under current law, the federal government covers up to 75% of the cost of Medicaid in lower-income states such as Mississippi and half the cost in high income states such as New York. The federal share of covering the expansion population is the same in every state.
The health care overhaul that passed the House would end the high federal matching share for the expanded Medicaid population by 2024.
States spent $211.6 billion of their own revenue on Medicaid in 2015, making it their second biggest expense behind K-12 education.
Only 10 states reached a 15-year high in 2015 in terms of the percentage of their in state revenues that went to Medicaid. They were Alaska, Delaware, Louisiana, Mississippi, Montana, Ohio, Oklahoma, South Dakota, Texas and Wisconsin.
Only three of those 10 – Alaska, Delaware and Ohio – expanded their Medicaid eligibility under the Affordable Care Act.
