A recent report from the Kaiser Family Foundation shows that Medicaid spending growth slowed dramatically in 2012. The report says that the total amount that the federal and state governments spent on Medicaid increased by 2% in 2012. In 2011 the increase had been almost 5 times that, at 9.7%. Prior to the economic downturn of 2008, the lowest annual percentage increase occurred in 2006, when Medicaid spending saw a 1.3% increase.
Analysts say that the slow increase in Medicaid expenditures occurred primarily because of both efforts to reduce the cost of the program as well as increased tax revenue generated by a strengthening economy. Fewer people also enrolled for the program, with a 3.2% nationwide average growth in enrollment in 2012, down from about 4.4% in 2011.
The analysts who created the report also expect Medicaid enrollment and expenditures to continue to slow next year. This comes even as states are considering expanding Medicaid under the Affordable Care Act to include anyone who earns up to 133% of the federal poverty guidelines. Though Mississippi has become the first state to reject the proposed expansion, many other states have yet to weigh in.