A Look at Variation in Medicaid Spending Per Enrollee by Group and Across States

Medicaid is the first program offering complete well being and long-term care protection to roughly one in 5 low-income Individuals. States administer Medicaid applications inside broad federal guidelines, however have flexibility in designing applications, which creates variation in spending and enrollment in addition to spending per enrollee throughout eligibility teams and states. Understanding variation in Medicaid spending per enrollee may also help inform the implications of varied coverage proposals – equivalent to increasing protection for Medicaid enrollees or closing the protection hole, as favored by the Biden-Harris Administration, or restructuring Medicaid financing right into a block grant or a per capita cap in addition to limiting Medicaid eligibility and advantages, insurance policies which have up to now been favored by former President Trump.

This knowledge observe supplies an summary of complete Medicaid (state and federal shares) spending per enrollee for full-benefit Medicaid enrollees by eligibility group and state in 2021. Knowledge from 2021 is probably the most present last model of Medicaid knowledge on the time of this evaluation. Full-benefit Medicaid enrollees are people who qualify for a full vary of Medicaid providers equivalent to physician’s visits, hospitalizations, prescribed drugs, and residential well being providers. A small variety of complete enrollees (9% of all enrollees in 2021) qualify for under a restricted set of Medicaid advantages equivalent to household planning or remedy of an emergency medical situation and are usually not included on this evaluation. References to Medicaid enrollees on this knowledge observe discuss with full-benefit enrollees. See strategies for extra particulars. Detailed state-level knowledge are additionally obtainable on State Well being Info.

Nationwide Medicaid spending per enrollee was $7,593 in 2021, although that diverse extensively by eligibility group (Determine 1). Total, kids account for 37% of full-benefit enrollment, however 15% of the spending, whereas seniors and people with disabilities account for 21% of enrollment however 52% of the spending (knowledge not proven.) The disproportionate spending on sure eligibility teams stems from variation in spending per enrollee throughout the eligibility teams. Spending per enrollee was highest for seniors, these ages 65 and older ($18,923), and people with disabilities ($18,437) (Determine 1). These teams had per-enrollee spending roughly six instances increased than baby enrollees ($3,023), which had the bottom spending of any eligibility group (Determine 1). Variations in spending per enrollee mirror variations in well being care wants and utilization. For instance, seniors and people eligible on the premise of incapacity are inclined to have increased charges of power circumstances, extra advanced well being care wants and usually tend to make the most of long-term providers and helps (LTSS) than different enrollees. Most seniors and a few people with disabilities enrolled in Medicaid are additionally dually eligible for Medicare. For dual-eligible people, Medicare is the first payer for acute care providers whereas Medicaid pays for providers that Medicare doesn’t, together with imaginative and prescient, dental, and most LTSS. Medicaid spending per enrollee accounts for lower than half of all spending for full-benefit dual-eligible people which might be 65 and older.

Flexibility for states to find out eligibility ranges, advantages, and supplier funds within the Medicaid program results in vast variation in per-enrollee spending throughout states (Determine 2). Different elements contributing to variation in per-enrollee spending embrace variation in state populations and demographics, means and energy to boost income, and variation in well being care prices and markets. Throughout states, Medicaid spending per enrollee ranged from $3,750 to $12,425, with a median spending of $7,784 (Determine 2). Tennessee, Florida, Oklahoma, and Nevada reported a number of the lowest spending per enrollee, whereas Washington, D.C., Virginia, Massachusetts, and Minnesota reported the very best spending per enrollee. Roughly one-fifth of states had spending higher than $9,000 per enrollee (Determine 2).

Inside every eligibility group, there may be additionally appreciable variation in spending per enrollee throughout states (Determine 3). People with disabilities had the widest variation throughout states for per-enrollee spending, starting from $4,602 in Florida to $52,602 in Connecticut (Determine 3). States have appreciable flexibility to determine the populations and providers coated for LTSS, which drives massive variation in per-enrollee spending for seniors and folks with disabilities, who’re extra possible to make use of LTSS. In distinction, per-enrollee spending for youngsters ranges from $1,958 in Tennessee to $6,012 in Kentucky (Determine 3). All states should present complete protection for youngsters by means of the Early Periodic Screening Prognosis and Remedy (EPSDT), which contributes to considerably much less variation in per-enrollee spending for youngsters.

Many—however not all—states which have comparatively excessive or low total per-enrollee spending are inclined to see those self same patterns throughout eligibility teams within the state (Determine 3). Some states with the bottom total per-enrollee spending (e.g. Tennessee, Oklahoma) fall among the many states with the bottom per-enrollee spending for all eligibility teams (Determine 3). Others, equivalent to Florida and Nevada are extra combined throughout eligibility teams. For instance, Florida, has low per-enrollee spending throughout all eligibility teams besides for youngsters, the place it has one of many highest per-enrollee spending. Equally, some states with the very best total per-enrollee spending (e.g. Washington, D.C., Virginia) fall among the many states with the very best per-enrollee spending for all eligibility teams. Nonetheless, states like Minnesota and Massachusetts are much less constantly excessive throughout all eligibility teams (Determine 3).

Even inside a given state and eligibility group, there may be vast variation in spending (Desk 1). For instance, amongst people with disabilities in Virginia, 25% had spending lower than $16,051 and 5% had spending greater than $127,703 – eight instances increased (Desk 1). Moreover, 25% of seniors in Alabama had spending lower than $2,061, and 25% had spending fourteen instances higher ($28,761) (Desk 1). Regardless of the commonly decrease prices for non-disabled grownup and baby enrollees, the variation in spending for these eligibility teams was vast in Washington, Colorado, and North Carolina as effectively.

Per-enrollee spending in states that expanded Medicaid was increased for all eligibility teams than in non-expansion states (Determine 4). Enlargement states spent on common $8,116 per enrollee – over $2,000 extra per enrollee when in comparison with non-expansion states, which spent $5,988 per enrollee (Determine 4). Some have argued that adopting Medicaid growth diverts funding from non-expansion enrollees (e.g. kids, people with disabilities) to enrollees eligible solely after increasing Medicaid (i.e. ACA growth adults). Nonetheless, throughout all classes, common per-enrollee spending is increased in growth states. For example, growth states have a median spending of $25,170 per enrollee eligible primarily based on incapacity, whereas non-expansion states spend on common $10,494 per enrollee in the identical eligibility group. Equally, growth states spend $19,783 per senior enrollee in comparison with $15,915 for non-expansion states (Determine 4). These variations in spending could mirror state coverage selections about advantages and eligibility, along with cost charges, regional variation in well being care prices, and state demographics.

Methodology

Key limitations: Nationwide per-enrollee spending numbers don’t embrace West Virginia or Mississippi because of knowledge high quality issues flagged by the DQ Atlas in 2021.