Regarding “State Medicaid spending swells even as enrollment flattens,” it’s an interesting article, but when you look at who is making out on Medicaid reimbursement, it definitely is not the healthcare providers.
In Iowa, Medicaid managed-care organizations have seen annual increases in payment from the state (around 8% annually), while my hospital in the four years of Medicaid managed care has seen $2.4 million less in overall payments (representing almost 8% to 10% of our overall net revenue), while our volume has increased. In my opinion, it seems that the lower reimbursements to hospitals is just getting transferred to the administration costs of these for-profit insurers (where else would it go?)
So as far as what is driving up most of the costs, well it definitely cannot be what is being paid to provide actual healthcare services. Most of the money from this program now goes out of state to these managed-care companies.
I would agree that the costs of medications for Medicaid could also be a component, but aren’t some of these costs rebated by the manufacturers for most medications? If the state is not obtaining rebates, that could be part of the increase in medication costs.
This is just my take as head of a small critical-access hospital with about a 20% Medicaid population.
Administrator and chief financial officer
Keokuk County Health Center