Using Medicaid to Support Working Age Adults with Serious Mental Illnesses in the Community: A Handbook. CHAPTER 2: ESSENTIAL FEATURES OF THE MEDICAID PROGRAM


Medicaid is a very large, complex, multi-faceted federal-state program. Through the program, states and the federal government each year underwrite health and long-term services for about 51 million low-income children and adults. This chapter describes the essential features of the Medicaid program. It is principally intended for readers who may not be familiar with the program’s basic features.

Medicaid is a joint federal-state program that provides health and long-term services to low income adults and children, including people with disabilities. About one out of every seven of our nation’s citizens obtains health care that is funded through Medicaid.1 In 2003, state-federal Medicaid expenditures totaled $259.6 billion, an increase of more than 50 percent since 1997.2 Federal funds account for more than one-half of total expenditures. Medicaid ranks second only to Medicare in federal health care outlays; it also is the single largest source of federal financial aid to states. At the state level, only spending for elementary and secondary education exceeds state tax dollar expenditures for Medicaid.

Medicaid is multi-faceted. It not only provides access for low-income individuals to essential health care but also pays for more than one-half of all long-term services for older persons and people with disabilities. As noted in Chapter 1, Medicaid is playing an increasingly important role in underwriting critical services and supports for working-age adults with serious mental illnesses.

This chapter provides basic background information concerning the “nuts and bolts” of Medicaid, including its history, the nature of the program’s federal-state relationship, eligibility, benefits, and other topics. The annotated bibliography lists additional resources that contain more in-depth information concerning Medicaid. Later chapters delve more deeply into facets of Medicaid that are most directly related to supporting working age adults with serious mental illnesses in the community.

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