Medicaid state officials predict the COVID-19 public health emergency will end in fiscal year 2023, leading to a decline in Medicaid enrollments, slower growth in total Medicaid spending, and a sharp rise in the share of costs. of the States

After strong earnings since 2020, state Medicaid agencies expect Medicaid enrollments to begin declining in fiscal 2023, following the expiration of the COVID-19 public health emergency (PHE), which most states assume will would be verified during FY 2023, according to the new KFF state Medicaid Budget Survey.

Projections of a decline in enrollment related to the end of the federal continuing enrollment requirement are also expected to translate into slower growth in total Medicaid spending in fiscal 2023. At the same time, the loss of federal correspondence funding is projected to Temporary strengthened by the pandemic era will result in a rebalancing of the federal and state spending mix, increasing state spending even as growth in total Medicaid spending is expected to slow. Medicaid officials reported that uncertainty surrounding the end of the PHE makes it difficult for states to plan for PHE liquidation and develop state budgets.

Medicaid’s 22nd Annual State Directorial Survey Finds States Expect Medicaid Enrollment Growth to Slow to 8.4% in Fiscal 2022 (down from 11.2% a year earlier) to decrease by 0.4% in 2023.

The decline in enrollments is likely to accelerate over time, as many states have predicted that the public health emergency and continuing coverage requirement will last through the end of this calendar year, in the middle of fiscal year 2023 for most states. . The Biden administration recently announced that the PHE will run until mid-January and has promised to give states 60 days’ notice before ending the declaration of emergency.

The survey also finds that total growth in Medicaid spending – federal and state spending combined – is expected to peak at 12.5% ​​in fiscal 2022, before slowing to 4.2% in fiscal 2023. Medicaid state officials reported that the state (non-federal) share of Medicaid spending grew by 9.9% in fiscal 2022. They projected more marked growth in state spending of 16.3% in fiscal 2023 with the federal government expected to place an end to its enhanced interim funding.

In addition to the growth in enrollments, other drivers of the rise in Medicaid spending reported by state Medicaid agencies included inflationary pressures, increased utilization of services, and increased spending on home and community services (HCBS).

The survey, conducted by analysts at KFF and Health Management Associates, provides an annual look at Medicaid enrollment and spending trends, currently for fiscal years 2022 and 2023. Forty-nine states responded to the survey, although response rates to questions specifications varied. A complementary survey report offers an in-depth and specific examination of the state of policies in place in state Medicaid programs, as well as important changes and initiatives underway across the country.

As states continue to respond to pandemic-related health concerns such as increasing vaccination and booster rates and lengthy COVID treatment, states have also reported actions to focus on long-standing issues and new priorities including the improving equity and reducing health inequalities, maintaining access to telemedicine, improving access and support to behavioral health, and addressing workforce challenges.

Some notable findings from the report include:

  • Health equity. Advancing health equity is a long-standing important priority that was high during the pandemic. Two-thirds of states reported using at least one strategy to improve the completeness of race, ethnicity and language (REL) data. About a quarter of states reported the use of health equity-related financial incentives, mostly in Medicaid-managed care arrangements.
  • Benefits: States reported far more benefit expansions than benefit cuts in both FY 2022 and FY 2023. States are particularly focused on expanding services across the behavioral health care continuum, as well as expanding services for pregnancy and postpartum. Other areas of expansion of benefits include preventative services, dental services, and services to meet the social needs of members (such as food and shelter).
  • Telemedicine. States noted that extended telemedicine policies increased access to care during the COVID-19 pandemic and led to high use of telemedicine among populations. Most states have implemented or are planning initiatives to assess the quality of telemedicine and to address other telemedicine challenges (including access to technology and broadband, program integrity, outreach and education, and ‘equity). Most states have or plan to adopt permanent expansions of Medicaid telemedicine policies that will remain in effect even after the pandemic, although some are considering adding restrictions or guardrails.
  • Managed care. More than three-quarters of states that have contracted with managed care organizations (MCOs) reported that 75 percent or more of their Medicaid beneficiaries were enrolled in MCO as of July 1, 2022. In fiscal 2022, Carolina del Nord implemented its first MCO program. Missouri enrolled all ACA expansion adults in Medicaid MCOs when it implemented the ACA Medicaid expansion in October 2021.
  • Provider rates. The provider rate increases exceeded the rate restrictions for the service fee in FY 2022 and FY 2023. The increases were more common for nursing facilities and home and community service providers (HCBS) than for other categories of suppliers. While most states rely on capitated agreements with managed care organizations to provide Medicaid services, toll rates remain important benchmarks for managed care payments. Many states have noted that worsening inflation and labor shortages that have led to rising labor costs have led to pressure for tariff increases. Some states have noted that their adopted budgets for fiscal 2023 do not take into account current inflation levels, although inflation remains a concern.
  • Looking forward. States are bracing for the challenges of canceling continuing enrollment requirements and the expiration of other emergency authorities in place during the PHE. Additionally, states were facing fiscal uncertainty due to slower revenue growth projections, rising inflation and labor shortages, as well as potential changes in political scenarios, as 36 states await government election results in November 2022, with findings that may have implications for Medicaid state policies and for Medicaid subscribers.

The survey will be discussed today at noon ET during a web briefing held by KFF with the National Association of Medicaid Directors. The two new reports released today before the briefing are:

Medicaid Enrollment and Spending Growth: FY 2022 and 2023

How the Pandemic Continues to Shape Medicaid Priorities: Results of an Annual Medicaid Budget Survey for State Fiscal Years 2022 and 2023

For more data and analysis on Medicaid, visit

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