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.

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.

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 21.2 billion U.S. dollars.

Medicaid spending in the U.S.

Medicaid spending varies widely between states. California expended almost 118.9 billion U.S. dollars in 2022 while Wyoming spent some 0.7 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 40 percent of Medicaid spending is targeted towards individuals that are disabled. About 23 percent of Medicaid expenditures are used for acute care and some 21 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 40.9 billion U.S. dollars and the state government spent 31.3 billion U.S. dollars on Medicaid. Since then, federal and state spending increased to 399 billion U.S. dollars and 240 billion U.S. dollars, respectively, in 2019. Expenditures on this health insurance are expected to continue its trend, increasing to over one trillion U.S. dollars by 2027. Medicaid is the largest public health insurance program in the United States and covers roughly 75 million citizens in the country.

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.

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 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.

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.

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.

Graph and download economic data for Personal current transfer receipts: Government social benefits to persons: Medicaid (W729RC1A027NBEA) from 1966 to 2024 about transfers, social assistance, receipts, benefits, government, personal, GDP, and USA.

This data package contains the information of Medicare and Medicaid healthcare spending and healthcare cost and percentages by state.

In 1970, some 7.5 billion U.S. dollars were spent on the Medicare program in the United States. Fifty plus years later, this figure stood at 1,037 billion U.S. dollars. This statistic depicts total Medicare spending from 1970 to 2023.

Increasing Medicare coverage

Medicare is the federal health insurance program in the U.S. for the elderly and those with disabilities. In the U.S., the share of the population with any type of health insurance has increased to over 90 percent in the past decade. As of 2019, approximately 18 percent of the U.S. population was covered by Medicare in particular.

Increasing Medicare costs

Medicare costs are forecasted to continue increasing over time, with outlays rising to a predicted 1.78 trillion U.S. dollars by 2031 as the population continues to age. Certain diseases of old age, such as Alzheimer’s disease, are increasing in prevalence in the U.S., which will reflect on healthcare costs for the elderly. In 2021, Alzheimer's disease was estimated to cost Medicare and Medicaid around 239 billion U.S. dollars in care costs; by 2050, this number is projected to climb to 798 billion dollars.

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.

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.

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

The statistic represents the distribution of Medicaid expenditures, by service, for the state of Iowa in the fiscal year 2022. During this year, five percent of Medicaid expenditures were dedicated to acute care. Total Medicaid expenditures in the U.S. stood at approximately 804 billion dollars.

Medicaid total expenditures in the U.S. stood at some 728 billion dollars in federal fiscal year 2021.The statistic represents the distribution of Medicaid spending, by service, for the state of Tennessee. In that year, approximately 15 percent of total Medicaid spending was dedicated to acute care.

In 2022, health spending in the United States reached approximately 4.6 trillion U.S. dollars, and private insurance accounted for around 29 percent of that figure. However, public health insurance, which includes the Medicare and Medicaid programs, combined for a share of around 39 percent. The rising costs of health care coverage U.S. national health expenditure continues to increase and is projected to exceed four trillion U.S. dollars in 2021. Hospital care and physician services have been the leading spending categories for several years and combined for more than half of all health spending in 2021. In the same year, federal and state governments made up 61 percent of national health expenditures, with the federal government’s share accounting for 27 percent. The differences between Medicare and Medicaid Medicare and Medicaid were both signed into U.S. law by President Johnson in 1965. Medicare is a health insurance program solely funded by the federal government. The plan was primarily created for all Americans aged 65 and older, regardless of their income. Medicaid is administered at a state level in accordance with some core federal requirements, but both fund the program. The plan provides health care to millions of Americans, and some states have expanded the Medicaid program to cover nearly all low-income adults under the age of 65.

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.

This dataset identifies health care spending at medical services such as hospitals, physicians, clinics, and nursing homes etc. as well as for medical products such as medicine, prescription glasses and hearing aids. This dataset pertains to personal health care spending in general. Other datasets in this series include Medicaid personal health care spending and Medicare personal health care spending.