Medicaid is managed under the Centers for Medicare and Medicaid Services (CMS), a division of Health and Human Services. Many people, including those in the government, become confused about the differences between Medicare and Medicaid. The easy way to remember the difference is that Medicaid is for the poor (aid), while Medicare cares for Americans 65 and older.
Most Medicaid recipients are children, mothers, disabled, or elderly. Many of those receiving support started out as middle-class people. But after they have “spent down” their savings, such as for treatment of a serious or chronic disease and particularly for nursing homes, they become eligible for Medicaid.
Medicaid costs are split between the federal government and the states, on a sliding scaled determined by the state's per capita income and the size of its low-income population. On average, the feds pay 57 percent. Medicaid is about tied with education as the most expensive category of state spending.
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In fiscal year 2008, total outlays for Medicaid, state and federal, were $356.1 billion. CHIP, (Children's Health Insurance Program) which is an expansion of Medicaid coverage to children whose parents are working poor and make too much to qualify for Medicaid, cost another $6.6 billion that year.
Nearly 61 million Americans received Medicaid in fiscal 2007, including about one-fourth of American children.
About half Medicaid's beneficiaries are children, who cost $2,435 a year to cover. Healthy adults, 23 percent, cost nearly 50 percent more. The elderly, 10 percent of all those covered, and the disabled, 18 percent, both cost more than $14,000 a year.
Medicaid costs are expected to grow rapidly over the next two decades as the population ages. Medicaid takes over when the patient's cash runs out, and since most people cannot afford bills of $60,000 a year for a nursing home, Medicaid pays for about half of all nursing home bills. Medicare, by contrast, only covers 100 days of nursing home care immediately after a hospital visit.
States control costs for Medicaid by deciding what services will be covered and who will be eligible. Congress also tries to limit spending on the entitlement program by cutting payments to nursing homes and doctors. Both can be a good source for stories. For instance, when Ohio was going to eliminate dental coverage for Medicaid, my paper showed how severely mentally retarded adults needed sedatives to manage their appointments, and featured one man who would have to go without care.
CMS says there are many reasons Medicaid spending keeps growing so fast (it's projected to grow 8 percent a year), such as:
More eligible people because of population growth, recessions, and federal mandates;
More very old and disabled people needing extensive long-term care;
Technological advances that keep more very premature babies and other critically ill or severely injured people alive. These people often need very costly care for the rest of their lives, and
Health care costs and drug costs that grow faster than inflation.
There are many experts who can walk you through the complexities.
The Alliance For Health Care Reform and Kaiser Family Foundation have lots of facts and figures. Kaiser has a large press office, and is generous about giving out numbers for other analysts and experts. Jodi Omear is communications director, 202-624-5346.
Tom Nickels is the Senior Vice President for Federal Relations at the American Hospital Association, 202-626-2314, which argues against payment cuts.
The National Governors Association has plenty to say about cost-shifting, 202-624-5300. Christopher Cashman is Senior Communications Manager, 202-624-7787.
Robert Helms, at the American Enterprise Institute, was on the Medicaid Advisory Commission, and used to be an assistant secretary at HHS. 202-862-5877. Direct inquiries to Veronique Rodman (firstname.lastname@example.org), Media Affairs Director, 202-862-4871.
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