HUSKY still very efficient but drugs are driving up costs
Like other states, Connecticut Medicaid per member costs are beginning to increase after dropping during COVID. However, Connecticut’s rate trend remains better than other states. Since switching from managed care organizations in 2012 to focus on care management, Connecticut Medicaid spending stabilized while enrollment expanded significantly, according to the state’s latest financial report. Even as COVID enrollment protections have lapsed, enrollment remains above pre-pandemic levels.
Connecticut Medicaid is very efficient. Administrative burden in the program is four-fold lower than Connecticut commercial insurance plans. This is likely because, unlike most states, Connecticut Medicaid no longer uses private, for-profit insurers to run our program.
Connecticut also spends less of our state budget on Medicaid than most states. That lower spending frees up $1.6 billion in the state budget for other priorities.
As in other states, spending on pharmaceuticals is the main driver of rising Medicaid costs since 2020, likely due to high-cost specialty drugs. However, Connecticut’s increases are below most states. Long Term Care spending, including nursing homes, dropped sharply from 2020 to 2021, largely due to COVID. Home care/waiver services and administrative costs are up.