Medicaid as a share of state spending has grown faster in Maine than anywhere else — but that may be on its way to changing.
Maine tops a list released Wednesday by Pew Charitable Trusts ranking states by growth in the share of their total revenue devoted to the low-income health insurance program. Every state but North Dakota is spending more cents out of every dollar on Medicaid than in 2000, the report shows. The data stops short of 2014, before the expansion of Medicaid through President Obama’s healthcare law.
There’s variation as to why, but experts say the biggest driver is that more Americans are signing up for the program. About one in five Americans are enrolled in Medicaid and the program now makes up about a quarter of all state spending.
This has raised concerns among states that Medicaid is increasingly eating up their available revenues — and nowhere has that phenomenon been more evident than in Maine. In 2000, the state spent 11.4 percent of its budget on Medicaid; by 2013, that had increased to 22.1 percent.
But for the last few years, Gov. Paul LePage has tried to reverse the trend. Besides vetoing a bill to expand Medicaid under the Affordable Care Act, he lowered the threshold to qualify for Medicaid, which resulted in about 67,000 people getting dropped from the program.
“Asking if Gov. LePage has been concerned about Maine’s Medicaid program is kind of like asking if Rudy Giuliani was concerned about crime in New York City,” said David Sorensen, a spokesman of Maine’s Department of Health and Human Services.
LePage, a Republican, was reelected as governor in November. When he first took office in 2011, Maine had the third highest Medicaid enrollment as a share of its population, but now ranks about average in that regard.
While LePage has been criticized by health advocates in the state, his administration is eager to take credit for the developments, pointing to the state’s reduced Medicaid spending burden.
“The LePage administration has made getting Maine’s Medicaid spending under control one of its foremost priorities over the past four plus years and we have seen incredible success,” Sorensen said.
After Maine, California felt the most upward spending pressure, with the share of its revenue going to Medicaid creeping up to 20.3 percent. Tennessee, New Hampshire, South Carolina and New York were at the other end of the spectrum, with their share of Medicaid spending inching up only slightly, according to the Pew report.
Several big factors helped push up Medicaid enrollment around the country over the last decade or so, including two recessions and more employers dropping their offers of health coverage. As the economy recovers and as employers are required to offer coverage under the health care law, those forces could lessen.
And while the health care law allows states to add more people to their Medicaid rolls, the federal government covers a majority of costs incurred by the new enrollees, sparing states from what would otherwise be massive new costs.
Still, state officials say they don’t expect Medicaid spending pressures to lessen anytime soon as various pressures are in play — such as the rising cost of prescription drugs.
That forces states to juggle competing priorities. Spending more on Medicaid takes funding away from other issues like education or transportation. But cutting people out of Medicaid can also end up costing states when people need care and don’t have the insurance to pay for it.
“It’s an ongoing budget challenge for states,” said Stacey Mazer, a senior associate with the National Association of State Budget Officers. “We do see it’s taking up more of the pie.”
