Books Medicaid

Medicaid Overview

If you’ve seen one Medicaid program, you’ve seen one Medicaid program.

This week, I will review some of the findings from a wonderful book titled The Politics of Medicaid.  Author Laura Katz Olson writes a well-researched book that evaluates Medicaid from the points of view of its various stakeholders including beneficiaries, providers (esp., physicians and nursing home), managed care organizations (MCOs), and the state and federal governments.  This post provides a general overview of the Medicaid program.


  • In 2001, it’s enrollment surpassed that of Medicare.
  • Roughly 70 of adult Medicaid participants are women, generally mothers or as frail elders in need of LTC.
  • Blacks compose 12.8% of the U.S. population, but 1/4 of the Medicaid population.
  • Latinos compose 15% of the U.S. population, but  1/5 of the  Medicaid population


  • Medicaid is the 4th largst program in the federal budget (behind Social Security, national defense, and Medicare).
  • Medicaid spending in 1966 was $1.2 billion.  In 2007, spending was $333 billion.
  • Medicaid spending is almost as high as Medicare spending ($375 billion)
  • Medicaid accounts for 15% of all American’s spending on health care.
  • Although the majority of individuals that Medicaid covers are pregnant women and children, one-third of program costs are dedicated to long-term care (LTC) services.
  • Although Medicare-Medicaid dual-eligible beneficiaries make up only 15% of Medicaid enrollment, they account for 42% of all Medicaid spending.


  • Children’s Health Insurance Program (CHIP) provides health insurance to a large share of American children.
  • CHIP is sometimes integrated into a state’s Medicaid program and sometimes administered as a separate program.


  • According to one study, 47% of adults would increase Medicaid funding and 46% would maintain current funding levels.
  • Medicaid had more support than most welfare programs (AFDC, TANF) but less than Social Secuirty, Medicare or SSI.
  • According to this KFF study, “Nearly three-quarters (74%) of adults say Medicaid is a “very important” government program, ranking it close to Social Security (88%) and Medicare (83%) in the public’s mind, equal to federal aid to public schools (74%), and above defense and military spending (57%). About 8 in 10 Democrats (82%) and Independents (79%) view Medicaid as an important government program, while fewer, but still 6 in 10 Republicans (61%) express that view.”


  • Initially, the federal government required state Medicaid programs to provide five benefits: inpatient hospital care, outpatient hospital treatments, laboratory and X-ray work, skilled nursing home care for individuals age 21 and older, and physician services.

Laura Katz Olson admits at the end of the book that she believes that “a single payer is a necessary component of any restructuring of medical insurance, including Medicaid itself.”  Despite this admission, the book is thoroughly research and well-written.  For anyone interested in what really happens in the Medicaid program, I highly recommend The Politics of Medicaid.


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