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State spending on Medicaid up sharply

The Washington Post | by N.C. Aizenman | October 28, 2011

The expiration of federal stimulus funding for Medicaid has dealt a blow to states still struggling to recover from the economic downturn, according to figures released Thursday.

To compensate for the loss of extra federal Medicaid dollars this June, states have increased their spending on the program by an average of 29 percent in the current fiscal year.

Nearly every state also has turned to tough measures to trim Medicaid costs, such as eliminating benefits, reducing payment rates to doctors and hospitals, and increasing the co-payments they charge the poor and disabled served by the program.

Even so, more than half of state officials surveyed said there was a 50-50 chance their Medicaid programs - which are financed with a combination of state and federal funds - would face a budget shortfall as enrollment continues to rise.

Though widely anticipated, the findings reported in an annual survey of state officials by the nonpartisan Kaiser Family Foundation underscored the stress Medicaid has placed on state budgets.

 

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