Brief Medicaid History and Future Challenges


The free reign of health benefits ended with the Deficit Reduction Act of 2005. In an effort to trim billions from Medicaid costs, the federal government removed many restrictions from state governments. (Deficit Reduction Act of 2005: Implications for Medicaid, 2006)

In an attempt to curb rising costs, states quickly took action. West Virginia required its users to sign a member agreement, otherwise benefits would be lost. Kentucky instituted higher co-payments and limits on prescriptions. Kentucky encouraged patients to sign up for a disease management program, which provided patients with extra benefits, such as eyeglasses. Florida worked on privatization. Some states began to focus more on prevention. (Goldstein, 2006)

The Kaiser Commission recently issued a 50 state Medicaid review. It concluded the recession is causing more people to enroll in Medicaid, resulting in increased spending. In 2009, enrollment grew by 5.4 percent and spending by 7.9 percent. Even with increased costs and enrollment, states managed to provide services. This was due to congress allocating money and the American Recovery and Investment Act. This funding is scheduled to terminate at the end of 2010. ("A Foundation for Health Reform: Findings of An Annual 50-State Survey of Eligibility Rules, Enrollment and Renewal Procedures and Cost-Sharing Practices in Medicaid and CHIP for Children and Parents During 2009," 2010)

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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