2023 saw the largest expenditures on Medicaid in U.S. history. At that time about 894 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.

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.

The Medicaid by Drug dataset presents information on spending for covered outpatient drugs prescribed to beneficiaries enrolled in Medicaid by physicians and other healthcare professionals. The dataset focuses on average spending per dosage unit and change in average spending per dosage unit over time. Units refer to the drug unit in the lowest dispensable amount. It also includes spending information for manufacturer(s) of the drugs as well as consumer-friendly information of drug uses and clinical indications. Drug spending metrics for Medicaid represent the total amount reimbursed by both Medicaid and non-Medicaid entities to pharmacies for the drug. Medicaid drug spending contains both the Federal and State reimbursement and is inclusive of any applicable dispensing fees. In addition, this total is not reduced or affected by Medicaid rebates paid to the states.

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.

Graph and download economic data for Personal current transfer receipts: Government social benefits to persons: Medicare (W824RC1) from Jul 1966 to May 2025 about social assistance, benefits, government, personal, and USA.

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.

Analysis of ‘Medicaid Spending by Drug’ provided by Analyst-2 (analyst-2.ai), based on source dataset retrieved from https://catalog.data.gov/dataset/004627ee-a5d6-4b7f-8af1-80cd7939e0c1 on 11 February 2022.

--- Dataset description provided by original source is as follows ---

The Medicaid by Drug dataset presents information on spending for covered outpatient drugs prescribed to beneficiaries enrolled in Medicaid by physicians and other healthcare professionals.

The dataset focuses on average spending per dosage unit and change in average spending per dosage unit over time. Units refer to the drug unit in the lowest dispensable amount. It also includes spending information for manufacturer(s) of the drugs as well as consumer-friendly information of drug uses and clinical indications.

Drug spending metrics for Medicaid represent the total amount reimbursed by both Medicaid and non-Medicaid entities to pharmacies for the drug. Medicaid drug spending contains both the Federal and State reimbursement and is inclusive of any applicable dispensing fees. In addition, this total is not reduced or affected by Medicaid rebates paid to the states.

--- Original source retains full ownership of the source dataset ---

Medicaid is an important public health insurance for individuals with a low income, those that are pregnant, disabled or are children. It was projected that by 2020 there would be approximately 76.7 million Medicaid enrollees. By 2027 that number is expected to increase to 82 million individuals covered.

Medicaid in the focus

Medicaid has recently been in the news for several reasons. A proposed Medicaid expansion was announced with the implementation of the Affordable Care Act in 2010. According to the expansion, all states were given the option to expand Medicaid programs to help provide insurance coverage to millions of U.S. Americans. As of 2019, 32 states have accepted federal funding to expand their Medicaid programs. Medicaid, after Medicare and private insurance, provides a significant proportion of the total health expenditures in the United States. In general, Medicaid expenditure, like the number of enrollees, has been growing over time.

Medicaid demographics

A significant proportion of Medicaid enrollees in the U.S. are children and low-income adults. Despite children accounting for most of the enrollees in the Medicaid program, the largest percentage of expenditures for Medicaid is dedicated to those enrolled as a disabled individual. Expenditures for the program also vary regionally. The states with the highest Medicaid expenditures include California, New York and Texas, to name a few.

This dataset reports summary state-by-state total expenditures by program for the Medicaid Program, Medicaid Administration and CHIP programs. These state expenditures are tracked through the automated Medicaid Budget and Expenditure System/State Children's Health Insurance Program Budget and Expenditure System (MBES/CBES). For more information, visit https://medicaid.gov/medicaid/finance/state-expenditure-reporting/expenditure-reports/index.html.

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.

Notes: 1. CAA 2023 provides a temporary 5.0 percentage point FMAP increase to each qualifying state and territory's FMAP under section 1905(b) of the Act, beginning April 1, 2023 through June 30, 2023. 2. CAA 2023 provides a temporary 2.5 percentage point FMAP increase to each qualifying state and territory's FMAP under section 1905(b) of the Act, beginning July 1, 2023 through September 30, 2023. 3. CAA 2023 provides a temporary 1.5 percentage point FMAP increase to each qualifying state and territory's FMAP under section 1905(b) of the Act, beginning October 1, 2023 through December 31, 2023. 4. States that have reported “0” either have no expenditures for that reporting category or have not yet reported expenditures for that category. 5. This report is a cumulative summary report that includes current and prior period adjustment expenditures that apply to this quarter and does not include Collections or Overpayment Recoveries.

This dataset reports summary level expenditure data associated with the new adult group established under the Affordable Care Act. These state expenditures are reported through the federal Medicaid Budget and Expenditure System (MBES). Notes: 1. “VIII GROUP” is also known as the “New Adult Group.” 2. The VIII Group is only applicable for states that have expanded their Medicaid programs by adopting the VIII Group. VIII Group expenditure information for the states that have not expanded their Medicaid program is noted as “N/A.” 3. States that have reported “0” either have no expenditures for that reporting category or have not yet reported expenditures for that category. 4. MCHIP expenditures are not included in the All Medical Assistance Expenditures.

This database includes the averages (2006, 2010, 2014, 2016 and 2017) of state financial condition in the United States, Medicaid spending per enrollee and a number of control variables in an analysis of the effects of Medicaid spending on state financial condition. The SPSS database is included here. The hypothesis was that the effects were significant and possibly positive. I found an offsetting effect on revenues and expenditures which nulled the overall effect on state financial condition.

The Medicare Part D by Drug dataset presents information on spending for drugs prescribed to Medicare beneficiaries enrolled in Part D by physicians and other healthcare providers. Drugs prescribed in the Medicare Part D program are drugs patients generally administer themselves. The dataset focuses on average spending per dosage unit and change in average spending per dosage unit over time. It also includes spending information for manufacturer(s) of the drugs as well as consumer-friendly information of drug uses and clinical indications. Drug spending metrics for Part D drugs are based on the gross drug cost, which represents total spending for the prescription claim, including Medicare, plan, and beneficiary payments. The Part D spending metrics do not reflect any manufacturers’ rebates or other price concessions as CMS is prohibited from publicly disclosing such information.

During a public health emergency in the Families First Coronavirus Response Act (FFCRA), a new optional Medicaid eligibility group was added called COVID-19 testing eligibility group. States reported these expenditures under sections 6004 and 6008 through the Medicaid Budget and Expenditure System (MBES) on the Form CMS-64. The data in these reports constitute summary level preliminary expenditure information related to these FFCRA provisions for each state

Notes: 1. The Families First Coronavirus Response Act (FFCRA), enacted on March 18, 2020, provided a temporary FMAP increase to states and territories meeting certain qualifications and added a new optional
Medicaid eligibility group for uninsured individuals during a public health emergency in section 1902(a)(10)(A)(ii)(XXIII) of the Act, referred to as the “COVID - 19 Testing Group.”
2. FFCRA Section 6008 provides a temporary 6.2 percentage point FMAP increase to each qualifying state and territory's FMAP under section 1905(b) of the Act, beginning January 1, 2020 and lasting through
the end of the quarter in which the public health emergency (PHE) declared by the Secretary for COVID-19 ends, including any extensions.
3. FFCRA Section 6004 provides a 100 percent match rate for individuals eligible under the new optional Medicaid eligibility group in section 1902(a)(10)(A)(ii)(XXIII) of the Act, beginning no earlier than
March 18, 2020 and lasting through the end of the PHE for COVID-19.
4. States that have reported “0” either have no expenditures for that reporting category or have not yet reported expenditures for that category.
5. This report is a cumulative summary report that includes current and prior period adjustment expenditures that apply to this quarter 6. For the Quarter ending 03/31/2020: Delaware has Negative Total Computable Expenditures and Total Federal Share Expenditures due to the reporting of prior period adjustments during this period.
7. For the Quarter ending 09/30/2020: Colorado has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.
8. For the Quarter ending 03/31/2021: California has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period. This corrected FY 2020 Q4 expenditures for Treatment services that are not allowed for Section 6004 100% FMAP match. 9. For the Quarter ending 03/31/2021: Utah has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period. 10. For the Quarter ending 12/31/2022: California has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period. 11. For the Quarter ending 12/31/2022: Connecticut has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period. 12. For the Quarter ending 09/30/2023: Connecticut has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.
13. For the Quarter ending 09/30/2023: Illinois has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.
14. For the Quarter ending 09/30/2023: Minnesota has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.
15. For the Quarter ending 09/30/2023: Utah has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.
16. For the Quarter ending 09/30/2023: Washington has Negative Total Computable Section 6008 Covid 19 Expenditures and Total Federal Share Section 6008 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.
17. For the Quarter ending 12/31/2023: Colorado has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.
18. For the Quarter ending 12/31/2023: Connecticut has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.
19. For the Quarter ending 12/31/2023: Minnesota has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.
20. For the Quarter ending 12/31/2023: New Mexico has Negative Total Computable Section 6004 Covid 19 Expenditures and Total Federal Share Section 6004 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.
21. For the Quarter ending 12/31/2023: Hawaii has Negative Total Computable Section 6008 Covid 19 Expenditures and Total Federal Share Section 6008 Covid 19 Expenditures due to the reporting of prior period adjustments during this period.

CMS has released several information products that provide spending information for prescription drugs in the Medicare and Medicaid programs. The CMS Drug Spending Dashboards are online interactive tools that provide spending information for certain prescription drugs in the Medicare and Medicaid programs. CMS selected drugs for inclusion in the dashboards based on three criteria 1) drugs with high spending on a per user basis (Medicare Program) and drugs with high spending on a per prescription fill basis (Medicaid Program) 2) drugs with high total program spending and 3) drugs with high costs increases in recent years. The dashboard tools display relevant spending, utilization, and trend data and also include consumer-friendly information on the drug product descriptions, manufacturer(s), and uses. In addition to the Dashboards, CMS has released Medicare spending and utilization data for all Part B and Part D drugs. These summary data files were the basis for the Medicare Drug Spending Dashboard and include annual data for the most recent five years.

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.

United States NHE: HI: Medicaid: Federal data was reported at 361.245 USD bn in 2017. This records an increase from the previous number of 358.330 USD bn for 2016. United States NHE: HI: Medicaid: Federal data is updated yearly, averaging 62.724 USD bn from Dec 1966 (Median) to 2017, with 52 observations. The data reached an all-time high of 361.245 USD bn in 2017 and a record low of 632.000 USD mn in 1966. United States NHE: HI: Medicaid: Federal data remains active status in CEIC and is reported by Centers for Medicare & Medicaid Services . The data is categorized under Global Database’s United States – Table US.G084: National Health Expenditures.