2022 saw the largest expenditures on Medicaid in U.S. history. At that time about 824 billion U.S. dollars were expended on the Medicaid public health insurance program that aims to provide affordable health care options to low income residents and people with disabilities. Medicaid was signed into law in 1965. By 1975 around 13 billion U.S. dollars were spent on the program.

Groups covered by Medicaid

There are several components of the Medicaid health insurance program. The Children’s Health Insurance Program (CHIP) was started in 1997 to provide health coverage to families and children that could not afford care. As of 2021, children represented the largest distribution of Medicaid enrollees. Despite having the largest proportion of enrollees, those that were enrolled in Medicaid as children had the lowest spending per enrollee. As of 2021, disabled Medicaid enrollees had the highest spending per enrollee.

Medicaid expenditures

Currently, Medicaid accounts for 19 percent of all health care expenditure in the United States. Expenditures on Medicaid programs vary among the U.S. states and depend heavily on whether Medicaid expansion was accepted after the Affordable Care Act was enacted. California and New York are the top states with the highest Medicaid expenditures. It is projected that Medicaid expenditure will continue to increase at both the state and federal levels.

Federal government spending on Medicaid totaled 616 billion U.S. dollars in 2023. The forecast predicts an increase in Medicaid outlays up to over 898 billion U.S. dollars in 2034. The statistic shows the total federal Medicaid spending history from 2000 to 2023, with an additional forecast from 2024 to 2034.

This statistic presents the total Medicaid spending in the United States in the federal fiscal year 2022, listed by state. In that fiscal year, New Jersey's total Medicaid expenditure was approximately **** billion U.S. dollars. Medicaid spending in the U.S. Medicaid spending varies widely between states. California expended almost ***** billion U.S. dollars in 2022 while Wyoming spent some *** billion U.S. dollars in the same year. Medicaid is a health program that targets families and individuals earning a low-income in the United States. Each state is able to determine the eligibility of individuals to enter the program. Children are among the largest group enrolled in Medicaid, however, almost ** percent of Medicaid spending is targeted towards individuals that are disabled. About ** percent of Medicaid expenditures are used for acute care and some ** percent used for long-term care. Medicaid since the ACA The establishment of the Affordable Care Act increased state and federal spending dedicated to Medicaid. In 1990, the federal government spent **** billion U.S. dollars and the state government spent **** billion U.S. dollars on Medicaid. Since then, federal and state spending increased to *** billion U.S. dollars and *** billion U.S. dollars, respectively, in 2019. Expenditures on this health insurance are expected to continue its trend, increasing to over ************ U.S. dollars by 2027. Medicaid is the largest public health insurance program in the United States and covers roughly ** million citizens in the country.

In 2022, Medicaid expenditure totaled around 805 billion U.S. dollars, the highest in the provided time interval. The federal government paid approximately 70 percent of total Medicaid expenditures in 2022, with states picking up the other 30 percent. Medicaid’s high-cost enrollees Spending on aged enrollees and individuals with disabilities accounted for more than half of the total Medicaid expenditure in 2021. One reason why this share is so high is that these groups require greater health care, and often the services are more costly. Spending on long-term care services, which includes nursing facilities and home health care, totaled approximately 154 billion U.S. dollars in 2022. Overall, long-term care services accounted for around 20 percent of all Medicaid expenditure in 2022. The basics of Medicaid funding Medicaid is a joint federal and state health care plan, and the costs of administering the program are split between the two. States report their Medicaid costs to the federal government on a quarterly basis, and the federal government matches those costs based on a formula. This formula is designed so that the federal government pays a larger share of costs in poorer states, but in general, state costs are matched by the federal government at a 50 percent rate. California was the state with the highest Medicaid costs in 2022.

The statistic represents the total Medicaid spending projections from 2018 to 2029, as a percentage of the gross domestic product. Medicaid spending totaled to 389 billion U.S. dollars in 2018, which was about 1.9 percent of the U.S. GDP.

Medicaid expenditure continues to grow and is projected to surpass one trillion U.S. dollars for the first time in 2027. It is estimated that the federal government will continue to pay around 60 percent of total Medicaid costs over the coming years, with states picking up the other 40 percent.

Federal government pays a higher share The Medicaid expenditure forecasts are similar to spending patterns of recent years, with an approximate 60:40 split between the federal government and the states. In 2017, the federal government spent around 370 billion U.S. dollars on Medicaid costs, while states paid nearly 230 billion U.S. dollars. Total Medicaid expenditure increased for eleven consecutive years between 2006 and 2017, and much of the growth is the result of higher enrollment numbers.

How are state costs matched by the federal government? Although the federal government establishes a framework for all states to follow, each state can administer its own Medicaid program differently. The costs of operating the program are shared between the two, with the federal government matching state spending for eligible beneficiaries based on a formula called the federal medical assistance percentage (FMAP). This calculation is designed so that the federal government pays a larger share of costs in poorer states, such as West Virginia and Mississippi. In 2020, the FMAP ranged from a base level of 50 percent up to 77 percent.

The number of people enrolled in Medicaid increased by 6.5 percent in 2023, while expenditure increased by 8.3 percent. Due to Medicaid unwinding in 2024 Medicaid enrollment is projected to decline by 8.6 percent, while the spending is expected to grow by 3.4 percent.

Impact of COVID-19 on Medicaid Approximately 18 percent of Americans were covered by Medicaid in 2020. The total number of Medicaid enrollees continues to increase each year and is projected to surpass 75 million in 2019. A steadily improving economy in the United States is one reason for the slower enrollment growth experienced in recent years. However, unemployment numbers surged due to the COVID-19 pandemic, and Medicaid enrollment is expected to rise over the coming months as millions of people lose their employer-based health insurance.

Medicaid expenditure set to increase Medicaid expenditure in 2019 was projected to 640 billion U.S. dollars, an increase year on year. Medicaid spending rose by 7.1 percent in 2020, but the economic downturn caused by COVID-19 is likely to significantly increase both state and federal expenditures. More people are now eligible for Medicaid because they have lost income, and the costs of coronavirus testing and treatment are escalating. Many states may not have the budget to pay for it all, especially at a time when tax revenues are declining.

In the financial year 2022, Medicaid's total spending grew by 12.5 percent, while state-funded Medicaid spending increased by 9.9 percent. This statistic depicts total and state Medicaid spending growth from FY 2000 to FY 2023.

Medicaid spent approximately 154.4 billion U.S. dollars on long-term care services in 2022, which was an increase on the previous year. California, New York, and Ohio were the states with the highest long-term care expenditures.

States support home- and community-based care Combined spending on nursing care facilities, home health care, and other health care made up roughly one-third of Medicaid’s total costs in 2019. Other health care costs include home- and community-based waiver programs that allow people to receive long-term care at home or in their community. Nearly all states offer the waivers, which can substantially reduce expenditures for Medicaid enrollees who would otherwise have to enter a long-term institutional service, such as a nursing home. In recent decades, the distribution of Medicaid’s long-term care services expenditures has shifted toward home- and community-based care.

The costs of in-home care are rising Long-term care expenditures vary depending on the setting, location, and level of care required. In 2020, the annual median cost of long-term care in the United States ranged from 19,240 U.S. dollars for adult day health care services to 105,850 U.S. dollars for a private room in a nursing home. In general, the costs of nursing home facilities were considerably higher than those for home care and community living options. However, in-home care reported the highest year-on-year cost increases, and growing demand for the services has led to a rise in spending on home health care over recent years.

Total Medicaid spending surpassed 804 billion U.S. dollars in 2022. The state of California had the highest expenditure throughout the year, followed by New York and Texas.

Federal government helps poorer states Both the federal and state governments fund the Medicaid health care program, but at least 50 percent of the costs incurred by states are matched by the federal government. The exact percentage varies by state because the matching rate was designed so that poorer states receive a larger share of program costs from the federal government. The states of Wyoming, South Dakota, North Dakota, spent the least on Medicaid costs in 2021.

Funding share of states set to increase Under the Affordable Care Act, states have the choice to expand their Medicaid programs to cover nearly all low-income Americans under age 65. For states that implemented the expansion, the federal government paid 100 percent of the state costs for all newly eligible adults from 2014 to 2016. The new matching rate has slowly declined since and reached 90 percent in 2020, which means states have to pick up ten percent of the bill. Governors are concerned about the rise in costs, and state expenditure is projected to increase by 50 percent between 2020 and 2027.

In fiscal year 2021, Medicaid spent 8,651 U.S. dollars per full-year equivalent enrollee. However, spending per enrollee varied by state with North Dakota spending the most per enrollee at 12,434 U.S. dollars, while in South Carolina each Medicaid enrollee cost 5,191 U.S. dollars. This statistic illustrates Medicaid benefit spending per full-year equivalent (FYE) enrollee in the United States in FY 2021, by state.

In FY 2021, Medicaid expenditure on disabled persons was estimated to have totaled 220 billion U.S. dollars, which was more than any other enrollment group. Disabled individuals also had the highest per enrollee Medicaid costs during the year.

The high costs of health care Federal and state governments together spent an estimated 640 billion U.S. dollars on the Medicaid health insurance program in 2019. Despite having the smallest shares of Medicaid enrollees, the elderly and disabled groups combined to account for more than half of all Medicaid expenditure in 2019. These two groups have a significantly higher per enrollee expenditure because they have greater long-term needs – Medicaid expenditure on acute care and long-term care benefits combined for approximately 260 billion U.S. dollars in 2017.

Which eligibility group has the most enrollees? Elderly individuals can qualify for Medicaid through several pathways, but an income-based methodology is primarily used to determine eligibility for most adults, pregnant women, and children. Children accounted for 37.5 percent of Medicaid enrollees in 2019, which was the largest share of all enrollment groups. Around 28 million children are enrolled in Medicaid programs across the United States, and the number of enrollees is projected to top 30 million in the coming years.

Children accounted for 36.5 percent of Medicaid enrollees in 2021, which was the largest share of all enrollment groups. The elderly and persons with disabilities had the smallest shares, but together they accounted for more than half of all Medicaid expenditure.

Medicaid expenditures per enrollee Medicaid is a joint federal and state health care program in the United States. The program provides medical coverage to millions of Americans and supports a variety of enrollment groups, particularly senior citizens and individuals with disabilities. Medicaid per enrollee spending is significantly higher for these two groups because they require more frequent and costly long-term care in the community and nursing homes. In 2022 of the total U.S. health expenditure on home health care, Medicaid paid one-third.

Millions of Americans are uninsured The United States has a multi-payer health care system, meaning that some Americans will be covered by private health insurance, and others will be covered by a government program such as Medicaid. However, approximately 27.6 million people in the U.S. had no health insurance in 2021, and should they require health care, they would have to pay the full price out of their own pocket. This becomes a real problem for many because the United States has the most expensive health care system in the world.

In 2022, Medicare and Medicaid national health expenditures reached 944 billion U.S. dollars and 805 billion U.S. dollars, respectively. The largest expense category for both healthcare care programs was hospital care. Long-term care solutions Medicaid’s second-largest expense category was other health care, which includes programs that provide alternatives to long-term institutional services. The use of home- and community-based services can substantially reduce expenditures for enrollees who would otherwise have to receive care in an institutional setting, such as a nursing home. In recent decades, there has been a significant shift in the distribution of Medicaid’s long-term care services expenditures. Medicaid’s federal-state partnership Medicare is a health insurance program solely funded by the federal government, whereas Medicaid plays an important role in both federal and state budgets. The federal government establishes certain parameters for all states to follow, but states can decide who gets coverage and what gets covered in its version of Medicaid. In 2021, California was the state with the highest Medicaid expenditure.

Between 2020 and 2027, both federal government and state spending are projected to increase by around 50 percent. During this period, federal expenditure is expected to rise from 419 billion U.S. dollars to approximately 625 billion U.S. dollars.

Growth in state Medicaid spending The expansion of the Affordable Care Act created an incentive for states: if they extended their health care programs, the federal government would fully fund coverage for all of the newly eligible non-elderly adults. However, the matching rate started to decline from 2017, and states had to start contributing towards the new beneficiaries. In 2020, the federal government’s matching rate dropped to 90 percent, and this is expected to have a noticeable impact on Medicaid state spending.

The impact of the coronavirus on state budgets Total Medicaid enrollment is expected to increase in the coming months due to the COVID-19 pandemic. The economic downturn has resulted in widespread job losses, and many people will subsequently lose their employer-based health coverage. States are not only left facing higher than expected Medicaid costs, but they will also receive lower income tax revenues due to people being out of work and may have to pay out more in unemployment benefit payments.

This statistic represents the distribution of Medicaid spending in the United States, sorted by type of service, in federal fiscal year 2022. In that year, approximately 20.5 percent of total national Medicaid spending was due to fee-for-service acute care.

The statistic represents the distribution of total Medicaid spending by service for the State of Washington in federal fiscal year 2021. In that year, approximately 12 percent of Medicaid expenditures went to acute care.

In total, Medicaid expenditures stood at some 626 billion dollars in federal fiscal year 2022. The statistic represents the distribution of Medicaid spending, by service, for the state of Ohio. During this year, approximately 24 percent of total Medicaid expenditures went to long-term care in Ohio.

The statistic represents the distribution of Medicaid spending, by service, for the state of New York in federal fiscal year 2022. Approximately ten percent of total Medicaid spending went to acute care during this year. In total, Medicaid expenditures stood at some 824 billion dollars.

In the fiscal year 2022, Medicaid expenditure in California amounted to a total of about 119 billion U.S. dollars, of which 81 billion U.S. dollars were federal-funded and approximately 38 billion U.S. dollars were state-funded. California had, as expected, the highest spending and also the largest number of people enrolled in Medicaid in the United States. The Federal Medical Assistance Percentage (FMAP) varies by state depending on the state's per capita income compared to the national average.