States spent more than a quarter of their budgets on Medicaid for the first time in 2014, with the total share estimated at 25.8% by the National Association of State Budget Officers.
That 25.8% represents expenditures of $460.5 billion, excluding administration costs – an increase of 11.3% over 2013. Medicaid was the single largest component of total state spending last year, NASBO noted in its annual State Expenditure Report, and has been every year since 2009.
State funding for Medicaid increased by 2.7% in 2014, while the federal share of funding went up by an estimated 17.8%, compared with 2013. Medicaid enrollment was projected to increase by 8.3% across all states in 2014 after going up 1.5% in 2013; it is expected to increase by 13.2% in fiscal 2015, NASBO said.
“Implementation of the Affordable Care Act has greatly increased the number of individuals served in the Medicaid program in 2014 and thereafter,” the report noted, adding that the ACA’s Medicaid eligibility expansion option is expected to “add approximately 18.3 million individuals by 2021.”
