31% of Rhode Islanders used Medicaid in 2016

Program's budget has grown by nearly $600M since Obama health law expanded it

PROVIDENCE, R.I. (WPRI) – About 325,000 Rhode Island residents were enrolled in Medicaid at some point during the last budget year, giving the state the highest enrollment in New England, according to a newly released report.

The R.I. Executive Office of Health and Human Services is required under state law to publish the annual Medicaid Expenditure Report by March 15; in practice, however, the agency never finishes it on time, and the newest one was not released until this week.

The report gives a detailed look at how Rhode Island manages its multibillion-dollar Medicaid program, which provides health coverage to low-income individuals, splitting the cost with the federal government; it now accounts for about one-third of the state budget. Republicans in Washington are currently pushing major cuts to the program, with President Trump proposing this week to reduce federal Medicaid spending by $610 billion over the next decade.

The White House has not released a state-by-state breakdown of how much funding Rhode Island would lose, but state officials have estimated it would run to hundreds of millions of dollars a year. Supporters of the cuts argue Medicaid’s current trajectory is unsustainable, and say states will be given more flexibility in how they manage the program to deal with the reduced funding.

The new state Mediciad report shows about 31% of the total Rhode Island population was on Medicaid at some point in the year ended June 30, including 30% of its under-65 population, compared with 29% in Massachusetts, 25% in Connecticut, 15% in New Hampshire and 27% nationwide. Rhode Island Medicaid enrollment averaged 282,000 over the course of the year, since some recipients were on the program for only a few months.

Medicaid enrollment has grown enormously in Rhode Island since then-President Obama’s Affordable Care Act expanded eligibility in 2014, rising from 231,000 people before the law to 325,000 last year, the report shows. Annual average spending has actually decreased over that period, from $788 to $717 per Medicaid member, because many of the new enrollees have relatively low health costs.

“These expenditure trends compare quite favorably to both national Medicaid total expenditures and state commercial [per-member per-month] cost trends,” the reports says.

Total spending on Medicaid in Rhode Island has climbed from $1.85 billion the year before the Obama health law took effect to $2.4 billion as of last year, according to the report. Much of the increased Medicaid spending for newly eligible individuals has been covered in full by the federal government, though under current law the state will be responsible for up to 10% of those costs in the future.

Among the five groups covered by Medicaid, the biggest share of spending was on services for adults with disabilities, who accounted for about 31% of the $2.4 billion in costs. Spending on seniors and children/families made up 23% and 22%, respectively. The average elderly Medicaid enrollee cost $2,427 per month, while the average children/families enrollee cost less than $300.

The report also notes that a huge portion of the Medicaid budget is spent on care for a tiny number of enrollees, with $1.2 billion going toward coverage for about 18,000 individuals with complex medical issues. The top 6% of Medicaid enrollees account for 62% of spending on medical claims, according to the report.

And where does the Medicaid money end up? Out of $2.4 billion total, nearly half went to hospitals and nursing homes.

Ted Nesi (tnesi@wpri.com) covers politics and the economy for WPRI.com. He writes Nesi’s Notes on Saturdays and hosts Executive Suite. Follow him on Twitter and Facebook