Medicaid Matters for North Carolina’s Revenue

Medicaid supports children, families, and older adults, helps people with disabilities reach their full potential, and serves as a safety net to all of North Carolina. In 2016, Medicaid served more than 1.9 million North Carolinians and supported more than 83,000 Medicaid providers across the state.

It also impacts our state’s economy – the state would face a shortfall of at least $4.4 billion over the next 10 years if lawmakers restructure Medicaid. Considering the importance of Medicaid to our state, it’s deeply concerning that members of Congress have produced a bill that would fundamentally restructure who Medicaid serves and how much North Carolina receives in federal money by establishing a per capita-based cap on federal payments. Recent estimates show the proposed bill would cut federal Medicaid funding by $880 billion over 10 years. By 2026, Medicaid spending would be about 25 percent less than what would be projected under current law.

All of this is occurring even though Medicaid’s rate of growth in spending per enrollee has been comparable to or lower than that of private insurance since the early 1990s. For example, between 2006 and 2013, the average annual growth in spending per enrollee for Medicaid was 1.9 percent while the spending per enrollee for private insurance (4.4 percent) was much higher.