GAO cautions that future growth rate of Medicaid uncertain despite dramatically low increase in costs last year
Back Page Briefs
July 31, 1997
WASHINGTON—An average national growth rate of 3.3% or lower in 1996 Medicaid expenditures was due in part to factors that "will probably not recur," according to a new report from the U.S. General Accounting Office (GAO/HEHS-97-128).
Those factors included substantially decreased disproportionate share hospital (DSH) payments, slowdowns in state-initiated eligibility expansions, and accelerated 1995 payments in response to federal proposals to block grant Medicaid.
The GAO report does not directly contradict the optimistic findings of the Urban Institute released six months ago, which predicted moderate growth averaging 7.4% through 2002, but it concludes that the future is "uncertain."
Among other key findings in the report prepared for the Senate and House budget committees:
• The national growth rate masked wide variations among the states from a decline of 16% to an increase of 25%. States showing the most substantial increases were Indiana and New Hampshire. States with the most significant decreases were Colorado, Florida, Hawaii, Louisiana, North Carolina, Oregon, Rhode Island, South Carolina, Tennessee and Wyoming.
• Actual growth in state and federal Medicaid expenditures in 1996 may have been substantially lower than the 3.3% figure that has been widely cited. Preliminary data on payments paid to the states by the federal government each month, historically a good indicator of total Medicaid expenditures, show only about 1.8% growth over the previous year.
• Total federal and state Medicaid expenditures in 1996 are estimated at $160 billion—accounting for roughly 6% of total federal expenditures and 20% of total state expenditures.
To order a copy of Medicaid: Sustainability of Low 1996 Spending Growth is Uncertain (GAO/HEHS-97-128), call 202-512-6000, fax 301-258-4066, or access it on the Internet at http://www.gao.gov.
GAO cautions that future growth rate of Medicaid uncertain despite dramatically low increase in costs last year
- Award-winning Medical Content
- Latest Advances & Development in Medicine
- Unbiased Content
