Historical and Projected Trends in Medicaid. VI. State Demographics

a. Distribution of State Expenditures

State spending on Medicaid has increased faster than any other major spending category over the past five years. Medicaid spending as a percent of total state spending has risen from 19.5 percent in 1999 to an estimated 21.9 percent in 2004, now surpassing spending on elementary and secondary education as the top expenditure category for states.

Figure 6

Source: State Expenditure Report, 2004, National Association of State Budget Officers

The percent of total expenditures spent on Medicaid by state can be seen in Figure A2 of the Appendix. Tennessee had the highest percent of its state expenditures going toward Medicaid at 35.2 percent and Wyoming had the lowest at 4.6 percent.

Medicaid per capita expenditures by state averaged $4,072 in 2003, the most recent year available (see Appendix Figure A3). New York had the highest per capita spending at $7,583 and California had the lowest at $2,520.

b. Percent of State Populations Covered by Medicaid

Medicaid, on average, now covers 26 percent of all children and 8 percent of all non elderly adults. These figures vary by area with states such as Arkansas, New Mexico, and the District of Columbia covering at least 40 percent of their children, and states such as Vermont, Maine and the District of Columbia covering at least 13 percent of their adult populations (see Table 3).

Low-Income Populations

States have a great degree of flexibility to set income eligibility levels at higher amounts than the federal minimum requirements. As a result, there is wide variation in the extent to which states cover their low-income populations. On average, states enroll 58 percent of their low-income children in Medicaid. Enrollment percentages range from 35 percent to 75 percent. Several states, such as Maine, Vermont, Arkansas, and the District of Columbia enroll over 70 percent of their low-income children in Medicaid (see Figure 7).¹¹ Other states, such as Colorado and Nevada have less than 40 percent enrolled.

The lower percentage of low-income adults enrolled in states’ Medicaid programs reflects the fact that most childless adults, regardless of income level, are not eligible. States on average enroll 27 percent (ranging from 14 to 48 percent) of their low-income adults in Medicaid. Maine, Tennessee, Vermont, Rhode Island, Massachusetts, and the District of Columbia enroll over 40 percent of this population (see Figure 8), while Nebraska, Utah, Colorado, Texas, New Hampshire, Virginia, and Nevada enroll less than 20 percent.

Elderly individuals are covered by the Medicare program, but are also eligible for coverage under Medicaid if they are low-income. These individuals are called dual eligibles, being covered under both programs.¹² States on average enroll 25 percent (ranging from 5 to 44 percent) of their low-income elderly individuals in Medicaid (see Figure 9). Tennessee, Mississippi, and Vermont enroll over 40 percent of this population, while New Hampshire, Illinois, Indiana, Nebraska, and Wisconsin enroll less than 15 percent.

Table 3. Nonelderly with Medicaid

Source: Urban Institute and Kaiser Commission on Medicaid and the Uninsured estimates based on pooled March 2004 and 2005 Current Population Surveys. Total US numbers are based on March 2004 estimates.

Source: ASPE Tabulations of the Census Bureau's Current Population Survey, 2003-2005.

Figure 8

Source: ASPE Tabulations of the Census Bureau's Current Population Survey, 2003-2005.

Figure 9

Source: ASPE Tabulations of the Census Bureau's Current Population Survey, 2003-2005.

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