Methods
Definition of Medicaid Spending. Total Medicaid spending includes all payments to Medicaid providers for Medicaid-covered services provided to enrolled Medicaid beneficiaries. Medicaid spending also includes special disproportionate share hospital (DSH) payments that subsidize uncompensated hospital care for persons who are uninsured and unreimbursed costs of care for persons on Medicaid. Not included in total Medicaid spending are Medicaid administrative costs and federally mandated state “Clawback” payments to Medicare (to help finance the Medicare Part D prescription drug benefit for Medicaid beneficiaries who are also enrolled in Medicare). States are also asked to exclude costs for the Children’s Health Insurance Program (CHIP). Total Medicaid spending includes payments financed from all sources, including state funds, local contributions, and federal matching funds. Historical state Medicaid spending refers to all non-federal spending, which may include local funds and provider taxes and fees as well as state general fund dollars.

Methodology. KFF commissioned Health Management Associates (HMA) to survey Medicaid directors in all 50 states and DC to identify and track trends in Medicaid spending, enrollment, and policymaking. Given differences in the financing structure of their programs, the U.S. territories were not included in this analysis. This is the 20th annual survey, conducted at the beginning of each state fiscal year from FY 2002 through FY 2021. The KFF/HMA Medicaid survey for this report was sent to each Medicaid director in June 2020. Forty-three states provided survey responses by mid-August 2020. The eight states that did not respond by this time are Delaware, the District of Columbia, Illinois, New Mexico, New York, Ohio, Rhode Island, and Utah.

For FY 2020 and FY 2021, annual rates of growth for Medicaid spending were calculated as weighted averages across all states. For FY 2020, 42 states reported Medicaid expenditure growth rates. For FY 2021, 40 states reported projected Medicaid expenditure growth rates. Weights for spending were derived from the most recent state Medicaid expenditure data for FY 2019, based on estimates prepared for KFF by the Urban Institute using CMS Form 64 reports, adjusted for state fiscal years. These CMS-64 data were also used for historic Medicaid spending and include all 50 states and DC. For FY 2018 and 2019, spending for New York was adjusted to reflect unexplained anomalies in the state spending on the CMS-64 data.

The average annual Medicaid enrollment growth rate for FY 2021 was calculated using weights based on Medicaid and CHIP preliminary monthly enrollment data for June 2020 published by CMS. For FY 2021, 41 states reported Medicaid enrollment growth rates. The data reported for FY 2019 and FY 2020 for Medicaid spending and FY 2020 for Medicaid enrollment are weighted averages, and therefore, data reported for states with larger enrollment and spending have a greater effect on the national average.

Historical enrollment trend data for FY 1998 to FY 2013 reflects the annual percentage change from June to June of monthly enrollment data for Medicaid beneficiaries collected from all states and DC. Enrollment trend data for FY 2014 to FY 2020 reflects growth in average monthly enrollment based on KFF analysis of the Medicaid & CHIP Monthly Applications, Eligibility Determinations, and Enrollment Reports from CMS for all 50 states and DC. Note that several states have revised monthly enrollment data as far back as June 2017 to better align with reporting criteria for the CMS, Medicaid & CHIP Monthly Applications, Eligibility Determinations, and Enrollment Reports. Data for months prior to June 2017 have not been revised and may use slightly different criteria for reporting monthly enrollment and generally result in larger enrollment totals.

Issue Brief Appendix

The Henry J. Kaiser Family Foundation Headquarters: 185 Berry St., Suite 2000, San Francisco, CA 94107 | Phone 650-854-9400
Washington Offices and Barbara Jordan Conference Center: 1330 G Street, NW, Washington, DC 20005 | Phone 202-347-5270

www.kff.org | Email Alerts: kff.org/email | facebook.com/KaiserFamilyFoundation | twitter.com/kff

Filling the need for trusted information on national health issues, the Kaiser Family Foundation is a nonprofit organization based in San Francisco, California.