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State Medicaid recipients up 174 percent since 1998

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news River Falls, 54022
River Falls Wisconsin 2815 Prairie Drive / P.O. Box 25 54022

In 1998, fewer than one in 13 Wisconsin residents received Medical Assistance (MA) from the joint state-federal Medicaid program aimed at providing health care to the poor, elderly, and disabled. Last month, that ratio was close to one in five, according to a new report from the Wisconsin Taxpayers Alliance (WISTAX). The nonprofit, nonpartisan research organization found the state's MA-recipient numbers had grown 174 percent, or an average of about 9.6 percent per year, from 395,000 in late 1998 to 1.085 million last month.

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Medicaid costs have grown almost as fast over the same period. Expenditures have averaged annual increases of 8.3 percent for a total increase of 140.7 percent, from $2.51 billion in fiscal 1998 to $6.05 billion in fiscal year 2009. Excluding federal funds, total dollars going to MA from various state sources - primarily income, sales, and excise taxes - have kept pace, growing 134.1 percent, or about 8.0 percent per year on average, during the same 1998-2009 period.

The WISTAX findings follow news reports earlier this week that suggested current program shortfalls, even after planned spending reductions. "There is little question that financial pressures on the Medicaid program have been aggravated by the recession and joblessness," WISTAX President Todd A. Berry observed. "But it is also important to understand that, recession or not, Medicaid has been in the state-budget driver's seat for a very long time, growing on average three or more times faster than the rest of state general-fund spending."

Berry went on to note that Medicaid, now the state's premier welfare program even though it focuses on health care, has undergone two periods of accelerated growth over the past decade. The first came in the late 1990s with the creation of Badger Care as one component of total welfare overhaul. The second has been since 2006. In recent state budgets, MA coverage was extended to virtually all children in the state. The current budget expanded coverage to childless adults, although enrollment for the new benefit has been temporarily suspended for cost reasons.

The WISTAX report, "Medicaid in state-budget driver's seat," concludes by asking whether, given mounting state and federal deficits, state government can sustain average MA spending increases of over 8 percent annually when spending in most other major state programs grows under 2.5 percent per year.

For a free copy of the report, write WISTAX, 401 North Lawn Ave., Madison, Wisconsin 53704; e-mail wistax @ wistax.org; or call (608) 241-9789.

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