Medicaid expansion states exploring cost-saving measures

With a record 73 million people enrolled in Medicaid, most states next year will tighten controls on spending to battle swelling budgets in the public health insurance program for low-income and disabled Americans, according to a report released Thursday. (Source: “Report: States Increase Cost Controls To Manage Medicaid Growth,” Kaiser Health News, Oct. 14, 2016).

According to a new Kaiser Family Foundation report, interest in curbing Medicaid costs is particularly acute in Washington, D.C. and the 31 states that expanded their Medicaid programs under the Affordable Care Act, because states will soon start paying 5 percent of expansion costs.

The leading strategies to contain costs are already used in some states, but they will soon take root in more places, the Kaiser Family Foundation reported in its annual 50-state survey. (Kaiser Health News is an editorially independent program of the Kaiser Family Foundation.)

Cost-cutting strategies include hiring private managed care companies to deliver services to enrollees, shifting more long-term care services from nursing homes to community settings and restricting the use of ever-more expensive prescription drugs.

Overall, 39 states work with private managed care plans for Medicaid beneficiaries, and in 28 of those states, including Ohio, at least three-quarters of enrollees are in such a plan, compared with 21 a year ago.