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Trends in Medicaid Spending Leading up to ACA Implementation

Issue Brief
  1. Unemployment data from Bureau of Labor Statistics: Current Population Survey, Labor Force Statistics. Income data from U.S. Census Bureau, Current Population Survey, Annual Social and Economic Supplements.

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  2. Kaiser Commission on Medicaid and the Uninsured and Urban Institute estimates based on KCMU Medicaid enrollment data collected by Health Management Associates. https://www.kff.org/medicaid/issue-brief/medicaid-enrollment-snapshot-december-2013/.

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  3. Laura Snyder, Robin Rudowitz, Eileen Ellis and Dennis Roberts. Medicaid Enrollment Snapshot: December 2013. Kaiser Family Foundation, June 2014. https://www.kff.org/medicaid/issue-brief/medicaid-enrollment-snapshot-december-2013/.

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  4. Unless otherwise noted, all years in this brief refer to the federal fiscal year (FFY), which runs from October 1 through September 30.

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  5. In this report we refer to FFY 2007 to 2010 as the “recessionary period” and FFY 2010 to 2013 the “post-recessionary period.”

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  6. Because hospital inpatient rates typically include inflation adjustment built into their rates, states reporting holding such rates flat as well as reductions in payment rates are considered restrictions. Physician rate restrictions only refer to actual reductions in rates.
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    Vernon Smith, Kathleen Gifford, Eileen Ellis, Robin Rudowitz and Laura Snyder, Moving Ahead Amid Fiscal Challenges – A Look at State Medicaid Program Spending, Enrollment and Policy Trends. Kaiser Family Foundation, October 2011. https://www.kff.org/medicaid/report/moving-ahead-amid-fiscal-challenges-a-look-at-medicaid-spending-coverage-and-policy-trends-results-from-a-50-state-medicaid-budget-survey-for-state-fiscal-years-2011-and-2012/.
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    Vernon Smith, Kathleen Gifford, Eileen Ellis, Robin Rudowitz and Laura Snyder, Medicaid Today; Preparing for Tomorrow – A Look at State Medicaid Program Spending, Enrollment and Policy Trends. Kaiser Family Foundation, October 2012. https://www.kff.org/medicaid/report/medicaid-today-preparing-for-tomorrow-a-look-at-state-medicaid-program-spending-enrollment-and-policy-trends-results-from-a-50-state-medicaid-budget-survey-for-state-fiscal-years-2012-and-2013/.

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  7. The CMS-64 includes a category of spending for payments to managed care plans for delivery of benefits to Medicaid enrollees. We classify these payments as acute care spending since the majority of managed care plans in Medicaid cover acute care (versus long-term care) benefits.

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  8. Although outside the time-frame of this analysis, it is worth noting that in January 2006, prescription drug services and spending for beneficiaries dually eligible in Medicare and Medicaid moved from Medicaid to Medicare Part D.

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  9. Effective in 2010, the ACA included provisions to increase the base federal rebate, including increasing the federal rebate on most brand name drugs from 15.1% of the drug average manufacturer price (AMP) to 23.1% of AMP.

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  10. IMS Institute for Healthcare Informatics, “Shift from Fee-for-Service to Managed Medicaid: What is the Impact on Patient Care? An early review of prescription drug utilization,” April 2013. Available at http://www.imshealth.com/deployedfiles/ims/Global/Content/Insights/IMS%20Institute%20for%20Healthcare%20Informatics/.

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  11. Vernon Smith, Kathleen Gifford, Eileen Ellis, Robin Rudowitz and Laura Snyder, Medicaid in a Historic Time of Transformation: Results from a 50-State Medicaid Budget Survey for State Fiscal Years 2013 and 2014. Kaiser Family Foundation, October 2013 https://www.kff.org/medicaid/report/medicaid-in-a-historic-time-of-transformation-results-from-a-50-state-medicaid-budget-survey-for-state-fiscal-years-2013-and-2014/.

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  12. Erica Reaves and MaryBeth Musumeci, Medicaid and Long-Term Services and Supports: A Primer. Kaiser Family Foundation, July 2014. https://www.kff.org/medicaid/report/medicaid-and-long-term-services-and-supports-a-primer/.

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  13. MaryBeth Musumeci. Key Themes in Capitated Medicaid Managed Long-Term Services and Supports Waivers. Kaiser Family Foundation, November 2014. https://www.kff.org/medicaid/issue-brief/key-themes-in-capitated-medicaid-managed-long-term-services-and-supports-waivers/.

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Appendix: Data Sources and Methods
  1. Due to lack of availability of FY 2010 MSIS data for Idaho, FY 2009 MSIS data for this state adjusted to the given state's 2010 CMS-64 expenditures was used. 2011 MSIS data is available for use, but because data is missing in several states, and because of remaining data quality issues, we opted to use the FY 2010 MSIS.

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