CT Medicaid’s managed fee-for-service model saved $300 million last year

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Updated 2/19/2019

We got very good news on Medicaid spending, again, at last week’s MAPOC meeting. Per member costs were down 2% from 2016 to last year, even despite hospital rate increases, saving taxpayers $300 million. The state’s share of Medicaid has barely budged since 2014, despite huge enrollment increases. CT remains behind other states in spending only 24.7% of our state budget on Medicaid, compared to 29.7% nationally. Spending on physician services are up, which is a good thing, keeping people out of the hospital. Nursing home costs, a huge share of Medicaid spending, were down 0.8%. At 3.5%, our administrative costs are far lower than the US average of 12%. Drug costs are down 21.4% from 2015 to 2018, largely due to higher rebates. The key is that, unlike other states, insurers don’t run our program providing administrative savings, better data for planning, simpler plan designs, and faster payments with less administrative burden on providers.