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Spending on Medicaid State Directed Payments Before New Limits Take Effect

Forty states and DC currently receive $93 billion in annual federal Medicaid spending through state directed payments (SDPs) and may be at risk due to forthcoming limits on these payments, according to new KFF estimates. Annual federal spending on SDPs is highest in California (an estimated $10.6 billion)—followed by Texas ($6.3 billion), North Carolina ($5.2 billion), and Illinois ($5.1 billion).

Forthcoming Policy Changes to Medicaid State Directed Payments

Changes to Medicaid State Directed Payments

The 2025 reconciliation law cut federal Medicaid spending by an estimated $911 billion from 2025 through 2034, some of which stems from new restrictions on Medicaid state directed payments (SDPs) for hospital and other health care services. This issue brief describes SDPs and forthcoming policy changes stemming from the 2025 law and the proposed regulation to implement those requirements and make other changes.

Medicaid Work RequiremEnts

Tracking the 2025 Reconciliation Law’s Medicaid Work Requirements: Data and Policies

To implement Medicaid work requirements, states will need to make important policy and operational decisions, implement needed system upgrades or changes, develop new outreach and education strategies, and hire and train staff, all within a relatively short timeframe. The information tracked here can serve as a resource to understand Medicaid work requirements and state options, gauge readiness, and track implementation of the requirements.

understanding medicaid

Medicaid Financing

Medicaid represents $1 out of every $5 spent on health care in the U.S. and is the major source of financing for states to provide health coverage and long-term care. This brief examines key questions about Medicaid financing and how it works.

Medicaid Program Integrity

This brief explains what is known about improper payments and fraud and abuse in Medicaid and describes ongoing state and federal actions to address program integrity.

Medicaid and Provider Taxes

All states except Alaska cover some state Medicaid costs with taxes on health care providers. This brief uses data from KFF’s 2024-2025 survey of Medicaid directors to describe current practices and the federal rules governing them.

Medicaid and Hospitals

Absorbing reductions in Medicaid spending could be challenging for hospitals, particularly for those that are financially vulnerable. This brief provides data on the reach of Medicaid across hospitals, patients, and charity care.

Medicaid Home Care

This issue brief provides an overview of what Medicaid home care (also known as “home- and community-based services”) is, who is covered, and what services were available in 2025.

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  • Money Follows the Person: A 2015 State Survey of Transitions, Services, and Costs

    Report

    The Money Follows the Person (MFP) demonstration provides enhanced federal matching funds, allowing states to better support Medicaid long-term services and supports beneficiaries in transitioning from institutions back to the community. This report highlights 2015 MFP enrollment and spending trends and services and supports offered across state MFP demonstrations.

  • Is ACA Coverage Affordable for Low-Income People? Perspectives from Individuals in Six Cities

    Issue Brief

    This brief presents findings from focus groups with low-income Medicaid and Marketplace enrollees in six cities: Baltimore, MD; Columbus, OH; Oakland, CA; Richmond, VA; St. Louis, MO; and Tampa, FL. It explores their experiences signing up for coverage; their perceptions of whether the costs they pay for their coverage are affordable; their experiences accessing care; and the impact of out-of-pocket costs on their ability to get needed care. It provides insights into the ongoing financial…

  • Puerto Rico: Fast Facts

    Fact Sheet

    Puerto Rico: Fast Facts provides a quick snapshot of the island's demographic, health, and economic characteristics. It also provides some information on federal Medicaid rules, infrastructure, and fiscal challenges ahead.

  • Medicaid Expansion Spending and Enrollment in Context: An Early Look at CMS Claims Data for 2014

    Issue Brief

    This issue brief analyzes spending and enrollment data made available by CMS through the MBES. It breaks out spending and enrollment for the new adult group (Group VIII) that gained coverage in states that adopted the ACA Medicaid expansion. It looks at spending and enrollment for the new adult group in calendar year 2014, putting such data in the context of overall Medicaid spending and enrollment and examines trends across expansion states.

  • Briefing: Medicaid and CHIP Eligibility and Enrollment in 2016, and a Look Ahead: Findings from a 50-State Survey

    Event Date:
    Event

    At 9:30 a.m. ET on Thursday, January 21, the Kaiser Family Foundation hosted a public briefing to present findings from our 14th annual 50-state survey of Medicaid and CHIP eligibility, enrollment, renewal, and cost-sharing policies. The survey, conducted by the Foundation’s Kaiser Commission on Medicaid and the Uninsured (KCMU) and Georgetown University’s Center for Children and Families, provides new data on states’ Medicaid eligibility and enrollment policies, which have undergone significant change in the two…

  • Web Briefing – Serving the Homeless Community: New Findings on the Impact of the ACA Medicaid Expansion

    Event Date:
    Event

    On Tuesday, April 26, 2016, KFF presented a web briefing to examine new findings about how the Medicaid expansion has affected patients who are homeless, as well as the providers who care for them. The briefing addressed changes in insurance coverage, revenues and costs among Health Care for the Homeless (HCH) projects, a subset of community health centers that serve individuals who are homeless, in both expansion and non-expansion states, as well as examined experiences…

  • What Paul Ryan’s Stance on 2016 Means for Health Care

    From Drew Altman

    In this column for The Wall Street Journal's Think Tank, Drew Altman discusses the implications of Paul Ryan’s decision to rule out being drafted as a Republican presidential candidate for the 2017 health care agenda and how it could focus greater attention on proposals to change Medicare and Medicaid along with the Affordable Care Act.

  • Medicaid’s Role for People with Dementia

    Issue Brief

    This issue brief describes Medicaid’s role for people with dementia, including how they qualify, what services Medicaid provides, and what their utilization and spending is, and builds on our work examining Medicaid’s role for vulnerable populations and Medicaid's role in the provision of long-term services and supports.