Growth in Medicaid Spending Slows Significantly
Due in large part to a strengthening economy and reduced state payment rates to
physicians and healthcare providers, Medicaid spending in 2012 grew at its slowest
rate in years. According to a survey from the Kaiser Family Foundation, government
spending on Medicaid increased 2% in 2012. In 2011 it grew by 9.7%.
The 2% growth is the lowest since 2006, when Medicaid spending grew by 1.3%.
The study also showed that decreased enrollment in the Medicaid program also likely
contributed to a decrease in spending. In 2011, enrollment increased by 4.4%, while
in 2012 that number was down to 3.2%.
Experts predict that the Medicaid program will continue to show slower growth in
the upcoming year. However, as states determine whether to expand the Medicaid
program under the terms of the Affordable Care Act, an expansion that could allow
anyone earning up to 133% of the federal poverty guidelines to enroll in the
program, the growth in Medicaid spending may be affected.
Recently, Mississippi became the first state to effectively opt out of the Medicaid
expansion, with other states likely to follow. The ability to opt out of the expansion
was granted by the Supreme Court’s decision about the Affordable Care Act
determining that the formerly mandatory expansion requirements were
unconstitutional. Now, states must determine if they will expand Medicaid as
directed, or choose not to.
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