Financing
The federal government and the states share responsibility for financing Medicaid. In fiscal year (FY) 2019, the federal share of Medicaid spending was 65 percent nationally. Funding for the nonfederal share of Medicaid comes from a variety of sources; at least 40 percent must be financed by the state and up to 60 percent may come from local governments. In state fiscal year 2018, 68 percent of funds came from state general revenues, 12 percent from local governments (including intergovernmental transfers and certified public expenditures), 17 percent from health care related taxes, and 4 percent from other sources (GAO 2020).
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Featured Publications
Hospital Non-Disproportionate Share Hospital (DSH) Supplemental Payment and Directed Payment Targeting Analyses
February 27, 2025
Hospital spending is a strategic priority for MACPAC’s analytic work due to its substantial effect on overall Medicaid spending. Hospitals receive a complex array of Medicaid payments, including various types of supplemental payments, and payment mechanisms vary significantly across states. This session presents new information on supplemental payments, specifically non-DSH supplemental payments such as upper […]
Improving the Transparency of Medicaid and CHIP Financing
June 18, 2024
Chapter 1 focuses on improving the transparency of financing the non-federal share of Medicaid and the State Children’s Health Insurance Program (CHIP). In the Commission’s view, the primary goal of improving financing transparency in these two programs is to better understand how much providers are paid today under currently permissible financing mechanisms. Identifying payment amounts […]
Improving the Transparency of Medicaid and CHIP Financing
April 10, 2024
Following up on the Commission’s discussion at the December 2023 Public Meeting, staff presented on transparency of financing the non-federal share of Medicaid and the State Children’s Health Insurance Program (CHIP). In this session, staff presented a draft chapter and recommendations to collect and publicly report information on the sources of non-federal share, including financing […]