MEDICAID IS DEVOURING FEDERAL, STATE BUDGETS
February 14, 2005
To see how Medicaid is devouring state budgets across the country, take a look at Mississippi. Over the past five years, state and federal spending in Mississippi on Medicaid -- the health program for the poor and disabled -- has doubled to $3.5 billion.
This has put tremendous pressure on the state budget, say observers:
- Fully one-quarter of the state's residents are on Medicaid.
- Medicaid is projected to cost Mississippi $268 million more than the state budgeted; the program will run out of money by the end of February 2005.
- The state has slashed road construction and may delay plans to raise the salaries of public school teachers to raise funds for Medicaid.
- Today, Medicaid serves some 53 million of America's poor, or about one in every six Americans.
- The program costs $300 billion a year in state and federal funds; in some states, Medicaid accounts for one-third of the budget.
- Medicaid pays 60 percent of the nation's nursing-home bill.
Observers say a state versus federal battle may be looming. Federal rules often frustrate cost-cutting since they require that the states cover many types of services such as pregnancy care for certain low-income women.
Source: Sarah Lueck, "Surging Costs for Medicaid Ravage State, Federal Budgets," Wall Street Journal, February 7, 2005.
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