Medicaid by State and Age Group in FY 2019:  Curiouser and Curiouser

The Centers for Medicare and Medicaid no longer provides state-level data on Medicaid expenditures and beneficiaries by age group, but it does provide state-level data on enrollment, expenditures, and expenditure per enrollee by “basis of eligibility.”  Spending per enrollee isn’t as good as spending per beneficiary in analyzing how much is being charged by the health care industry, because expenditure per enrollee is affected by the number of people enrolled who do not currently require expensive care.  And basis of eligibility is not as good as more detailed age groups, but it at least does provide separate data for children (under 18), non-disabled adults (18 to 64), seniors (65 and over), and disabled adults and children.  

When I looked at the per enrollee New York State data for FY 2019, however, I found it was reported to be far below the level of 2018, and even below the U.S. average for children and non-disabled adults.

Why?

This is the second post on Medicaid data by state from the Centers for Medicare and Medicaid’s Macstats website.

The first post, on total Medicaid spending in FY 2020, is here.

More detailed data by basis of eligibility is only currently only available for FY 2019, but when I downloaded expenditure spreadsheets for that year, I came across the following footnote.

8 State reported CMS-64 spending that shows a difference greater than 20 percent when compared with the prior year. New York’s spending on the CMS-64 was 20.7 percent lower compared with 2018.

What?  Does anyone believe that New York’s Medicaid spending could ever fall by more than 20.0% in one year?  Increase?  Sure.  It probably happened more than once between the early 1990s and the mid-2000s.  Decrease? 

I asked the Empire Center what happened, and they reminded me that they had discovered that then-Governor Cuomo and the New York State legislature had shifted $billions of Medicaid expenditures that had actually taken place in FY 2019 to the following fiscal year, to cover up a state budget deficit – in an up economy at a high tax level.

https://www.gothamgazette.com/politics/130-opinion/9142-colossal-failures-by-new-york-budget-division-cuomo-endanger-medicaid-program

As the State Legislature and the governor were finalizing enactment of the 2020 budget in late March of last year, the State Health Department was informing the Division of the Budget that the payments of Medicaid bills were so much larger than anticipated that the State would violate a spending cap on the Medicaid program by $1.7 billion for the fiscal year ending March 30, 2019.

The DOB and the Health Department then deferred the payment of the $1.7 billion to Medicaid providers several days into the new fiscal year that began on April 1, 2019. The deferral meant that the State Medicaid budget for 2019 had run over its projection from a year earlier by 10%, and Governor Cuomo and the Legislature had just adopted a budget, with a baseline Medicaid spending for the start of 2020 that was already $1.7 billion higher than 2019. The whole budget was out of balance as well and not being reported as such.

Despite DOB and the Health Department’s decision to push the Medicaid payment into the new fiscal year, DOB’s 2020 Enacted Budget Financial Plan released in April 2019 contained Medicaid spending numbers that were obviously wrong.

Just reminder – this is exactly the sort of financial fraud that the City of New York’s Lindsay and Beame Administrations engaged in during the run up to New York City’s fiscal crisis in the 1970s.

And while Cuomo isn’t in Albany any more, all those state legislators are still there, except for any additional legislators who have been convicted of corruption recently.  Which is probably none, now that Preet Bharara is no longer on the case and public corruption (like financial sector corruption) has been mostly decriminalized.

https://buffalonews.com/news/local/bharara-sees-corruption-all-over-new-york-state/article_641733b2-b73e-5fb2-aa61-c67c1890b29a.html

But let’s use what we’ve got as best we can, substituting per-enrollee spending for FY 2018 for New York State, instead of using the tainted FY 2019 numbers. 

A spreadsheet of this data is here.

Back in the day, I had tabulated spending per beneficiary by type of service, but that is no longer possible.  The Center for Medicare and Medicaid no longer provides data on beneficiaries by type of service, and the data on spending (in Macstats Exhibit 17) shows that more than half of the Medicaid expenditures in the U.S. – and 60.0% in New York State – is on Managed Care and Insurance Premium Assistance.  Since there is no way to know how much of that goes to, say, hospitals, physicians, home health care or drugs, the data that still is available for those categories is less meaningful.

But I do wish data was available for narrower age groups, because when it comes to Medicaid spending, or health care spending in general, not all children, adults or seniors are the same, as shown using data from the last time I had it available.

In any event, to have something to divide by I downloaded 2019 American Community Survey data from the U.S. Census Bureau on the total population (whose poverty rate could be determined) and poor population by age group…

And the disabled population by age group.

As in the prior post, I’ll show the data in a series of maps.  I’m new to this, and please bear that in mind.  First – children, who have a separate Medicaid funding stream, the Child Health Insurance Program (CHIP), enacted in 1997.  Additional children were enrolled in Medicaid as a result of the Medicaid expansion component of Obamacare.

The data shows that 42.4% of New York State’s children were enrolled in Medicaid in 2019, above the U.S. average of 37.1%.  Most low-income southern and western states had a higher percentage of their children enrolled in Medicaid than New York, with West Virginia (49.5%), South Carolina (51.1%), Louisiana (52.6%) and New Mexico (60.7%) among the highest.  Most Northeastern and Midwestern states had a lower-than-average share of their children enrolled in Medicaid, including New Jersey at 29.9%.  Connecticut is similar to New York, however, and Vermont, which at one point aspired to universal health care, is second highest on the country at 54.8%.

Medicaid was initially a program for the poor, other than seniors and the disabled who had special rules.  It was later expanded to the working class, a group that has largely lost private health insurance.  Thus one would expect Medicaid enrollment to exceed the number of poor people.

And that is the case.  The U.S. average is child Medicaid enrollment at 221.7% (more than double) the number of poor children.  The figure for New York State is 234.0%, about average.  Laggards at covering non-poor moderate-income children via Medicaid include Texas (182.0%), Mississippi (166.8%), Illinois (153.6%) and Utah (146.8%).  Illinois is a state where children, and later born generations in general, count for as little as they do in New York State compared with seniors and Baby Boomers.  Utah, however, requires some explanation.

One finds that Utah’s Medicaid expenditures on children per enrolled child is nearly 2 ½ times the U.S. average, at $8,114 compared with $3,336.  Most children require very little health care after age 1.  What this data implies is that many of Utah’s moderate-income children remain uninsured until something happens that requires expensive health care, and then their family ends up on Medicaid due to its cost.  That isn’t something to be proud of, as those children may not be receiving preventive health care, such as annual check-ups, that could at times have prevented severe illness.  And Utah is less an outlier for children than for those older.

New York State’s Medicaid spending on children per enrolled child was 22.6% higher than the U.S. average in FY 2018, matching up with per capita income that was about 25.0% higher than the U.S. average, and a state average cost of living that was probably similar.  (Obviously Upstate is very different from Downstate in that regard).  At least for children and at least at the statewide average, this implies that the health care industry was fairly compensated for providing health care in New York.  The reality is that despite the nation’s most expensive Medicaid program, and its most politically powerful health care sector, New York has never spent big on children, or on physicians and preventive care.  Back in the 1990s when New York’s Medicaid spending was soaring, in fact, it was among the lowest in the country per beneficiary for children and physicians.  

Today one finds that California is 13.5% below the U.S. average in Medicaid spending per enrolled child, and New Jersey is 12.4% below average, despite being high cost of living states.  These figures are almost as low as Florida (21.0% below average) and much lower than Texas (5.1% above average).   Remember, public school expenditures are higher in Texas than they are in California, once income and cost of living levels are taken into account.  (They are rock bottom in Florida).

Texas takes a Utah-like approach to non-disabled adults, however, with just 1.6% of that state’s population enrolled in Medicaid compared with 2.4% for Utah and a national average of 13.9%.  Other states with a very low percentage of non-disabled adults are enrolled in Medicaid include Florida at 4.7%, Georgia at 5.2%, Oklahoma at 5.4%, Missouri at 3.6%, and several low-population Great Plains states.

Both New York State at 24.0% and California at 28.0% are far above average at enrolling adults, along with the arc of poor states that the prior post found spend the most on Medicaid as a percent of their residents’ incomes – West Virginia at 20.7%, Kentucky at 27.0%, Arkansas at 18.9%, Louisiana at 25.2%, and New Mexico at 32.7%.

Obamacare expanded Medicaid to additional moderate-income adults, a step New York State had already taken previously under the Family Health Plus program.  The Supreme Court ruled that states did not have to expand Medicaid if they didn’t want to, despite the federal government covering 90 percent of the added cost, and many southern and some western states have refused to do so, as this map shows.

Obamacare changed something else about Medicaid that doesn’t get enough notice.  Previously, although only those with very low incomes qualified to enroll when they weren’t sick, once a moderate or even middle-income household faced a serious health crisis at inflated U.S. health care costs, they become “medically needy” based on high health care bills as a percentage of their (generally reduced due to the same health crisis) income.  In effect, the uninsured were in fact insured by Medicaid after the fact, with the health care industry doing the paperwork to collect the money.

Until Obamacare, however, seniors were treated very differently that other adults with regard to wealth.  Seniors could receive Medicaid-funded care while keeping their house, their car, their retirement accounts, even college savings for their grandchildren, while non-senior adults would have to cash all these in before qualifying for the program.  Now everyone can keep those wealth items – all that most Americans have, if they have any wealth at all – and still qualify for Medicaid if they get sick.  No wonder most don’t want to pay Obamacare health insurance premiums.

Still, with the Obamacare eligibility expansion, adult Medicaid enrollment ought to include far more adults than just the poor.  

Despite this, a broad swath of southern and western states don’t even have as many adult Medicaid enrollees as they do poor adults.  The lowest is Texas, with adult Medicaid enrollment  at just 13.8% of the number of poor adults.  In these states, there is presumably a large number of people who only enroll in Medicaid when they have a significant health problem, after failing to get preventive care.  Perhaps that’s why COVID-19 vaccination rates are so low in these states – the preventive care infrastructure and health care relationships didn’t exist.  Instead, people received no care until they were very ill, and then ended up in the hospital.

Nationwide adult Medicaid enrollment is 20.9% higher than the number of poor adults; in New York and California it is well more than double.  California, in fact, is generally a low spending state on Medicaid, especially compared with New York, the highest.  But California is tops among states in when it comes to enrolling adults in Medicaid, with the program presumably extending far beyond the poor and up to through the lower middle class.

With adults only enrolling in Medicaid when they are already ill and require health care, Medicaid expenditures per enrolled adult were above the U.S. average in Texas and Kansas, and nearly triple the average in Utah, as for children.

New York was at 32.7% above average in Medicaid expenditures per non-disabled adult enrollee.   High, given now many presumably not-yet-ill enrollees there are, but only slightly out of line with a per capita income that was about 25.0% above average.  That per capita income may be about to come down, however, while Medicaid expenditures may be about to soar.  

With Medicaid costs soaring in New York, the Greater New York Hospital Association was pushing for the seemingly impossible: more state reimbursement money.

It was a big ask, and for years, it had gone nowhere. Medicaid spending already represented an enormous and ever-growing share of the state budget, and Gov. Andrew M. Cuomo had taken steps to keep the program in check.

Then things changed.

As Mr. Cuomo was locked in a bitterly fought Democratic primary last year, his campaign asked the association, one of Albany’s most influential and richest power centers, to make a major donation to the State Democratic Party, according to a person familiar with the discussions.

The hospital association wrote two checks for the state party, totaling more than $1 million, campaign finance reports show. It was twice as much as the association, which represents New York City’s biggest health care institutions, had given to any campaign in at least a decade.

Local 1199 and the Greater New York Hospital Association were once the most politically powerful, selfish, and overfunded (compared with other places) special interest in New York.  Since the mid-2000s they have ceded that status to the United Federation of Teachers and New York State United Teachers.  That doesn’t mean they don’t want to take that status back.  

New York State’s school spending per student is nearly double the U.S. average, the way its Medicaid hospital spending per beneficiary used to be.  Today, “education advocates” still say the schools owe New Yorkers nothing because they are “underfunded,” no matter how much school spending per student goes up.  Back then, Local 1199 and the Greater New York Hospital Association ran TV ads that said if spending didn’t go up as much as they demanded, they’d let our babies die.

New York’s Medicaid program, and budget in general, are the best argument against single-payer health care in the country, as the state legislature is completely owned and operated by special interests whose only concern is their share of the total take.  The easiest way for those in the room to cut their deal is to increase the burden on those outside the room, or the services the serfs receive, or rob the future.  Nationwide, the U.S. doesn’t have a universal health care finance program despite Americans more than paying for it with taxpayer dollars, as I discussed here.

Just expensive health care.  And it the absence of a universal system, moreover, it may be that people are continuing to arrive from southern states after they are sick, having a cup of coffee here to qualify for Medicaid, receiving expensive hospital care half paid for with New York state and local taxes, and then return to their low tax red states.  That may increase expenditures per enrollee, since they are only enrolled in New York’s Medicaid when sick. That may also be a factor in the high Medicaid expenditures per adult enrollee in Minnesota, at 45.1% higher than the U.S. average – compared with 58.9% below average in next-door North Dakota.

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For the next two categories, seniors and the disabled, keep this in mind.  Seniors who worked at least 10 years, or were married to someone who worked at least 10 years, are eligible for Medicare, a program exclusively paid for by the federal government.  And in 1972, Medicare was expanded to include the disabled.  

People in either of these categories who are also on Medicaid are “dual eligibles,” and Medicaid isn’t paying for their health care.  Medicaid is paying for custodial care for those whom a service provider has determined cannot take care of themselves, and are not taken care of by family members, and for Medicare premiums.  Even so, dual eligibles accounted for 34.3% of total Medicaid expenditures in the U.S. in 2019.  In New York State, dual eligibles accounted for 46.6% of total Medicaid expenditures.

If the figures are to be believed, 23.3% of New York’s seniors were enrolled in Medicaid in 2019, the highest percent in the nation.  Only California (23.0%) and Connecticut (22.3%) were close.  The U.S. average was 13.7%.  

Not only do most seniors receive Medicare, but also the current cohort is the richest generation of seniors the country has ever seen, far richer than the currently-working age people who will follow them into old age.  In 2019, according to the American Community Survey, just 9.4% of U.S. seniors were poor, compared with 11.5% of other adults and 16.8% of children.  The New York State figures were 12.0%, 11.6%, and 18.1% respectively.  New York has always had a relatively high percentage of poor seniors, because of the “welfare generations” that moved to New York City in the 1960s and 1970s and then retired to SSI, but the gap is closing.

On the other hand, just 0.6% of Utah seniors, and 6.7% of New Hampshire seniors, were enrolled in Medicaid.  Texas and Florida are at about the national average by this measure.

For seniors, Medicaid has always been a middle-class entitlement, so one would expect the number of enrolled seniors to exceed the number of poor seniors.  Nationwide, there are 44.7% more enrolled seniors than poor seniors.  In New York state the number of enrolled seniors is nearly double the number of poor seniors, with even higher figures in California, Vermont, Massachusetts, Maine and Connecticut – places where today’s seniors are even less likely to be poor.

Utah once again stands out on the low side.  Perhaps seniors there are less likely to seek custodial care, or family members are more likely to provide it.

Not surprisingly, the few Utah seniors who do end up enrolled in Medicaid end up receiving average spending levels that are 14 times the U.S. average!

But New York State, with the highest percent of its seniors enrolled in Medicaid of any state, is nearly double the U.S. average at $33,827 each in FY 2018 compared with a U.S. average of $17,956.  And remember, that is spending over and above the health care funded by Medicare, and the custodial care paid for with Social Security checks.  It is on seniors that New York’s Medicaid expenditures are really sky high; its Medicaid priorities are no different that its public education spending priorities (early retired teachers and those in out of classroom assignments).

Why did New York’s Medicaid expenditures soar from already high levels?

Health care and budget experts have said a variety of factors are behind the trend, including an increase in demand for personal care programs that provide nonmedical services to disabled New Yorkers, a minimum-wage increase and financial assistance that the state has provided to struggling hospitals.

The Democratic Party and its media, like the Republican Party and its media, has a problem with a higher minimum wage for everyone, since that might increase the cost of living for seniors, active and retired public employees, and others paid for with taxpayer dollars, such as health care workers, and the rich.  So “progressives” generally advocate for a special higher minimum wage just for taxpayer-funded jobs in campaign contributing organizations, funded by the usual New York combination of tax increases, service cuts, and debts and deferrals leading to even more tax increases and service cuts down the line.  So, the fact that those on the inside thought a $15 minimum wage for everyone, including actual senior care workers providing actual senior care to actual seniors who actually need it, was a problem is no surprise.

But as for the expansion of personal care programs, I continue to believe that much of it is fraudulent, with politically connected or even criminal organizations billing Medicaid for workers to provide unnecessary services to seniors, or even for workers who don’t exist to not provide services to seniors who don’t exist either.

That fraud is over and above the additional social care for seniors that is being required due to family breakdown, which I wrote about here.

Meanwhile, among the states that many seniors from New York and New Jersey retire to in order to reduce their taxes, note how low Medicaid spending on seniors per enrollee is for those whose money runs out and require custodial care.  South Carolina’s Medicaid expenditures per enrolled senior was 27.2% below the U.S. average, North Carolina’s was 30.1% below average, and Florida’s was 38.1% below average.  As the chart above shows, North Carolina and Florida employment in senior care industries per 1,000 people ate 75+ was very low, and while it is soaring in New York, it is falling in those states.  Those from the Midwest retiring to Arizona and Nevada will eventually find that their Medicaid spending per enrolled senior is even lower.  No wonder many who retire to states like these to avoid taxes, return to higher tax states when they require expensive taxpayer funded care.

The Medicaid by state pattern for the non-senior disabled is similar to that of seniors.

Nationwide, the number of disabled non-seniors (under 65) enrolled in Medicare is 39.5% of the total non-senior population disabled identified by the American Community Survey.  New York State has one of the highest enrollment levels, with enrollment equal to 51.9% of the total non-senior disabled population.  Almost no disabled people in Utah are on Medicaid, if the data is to be believed, with Connecticut, Illinois and Oregon also on the low side.

Recall, however, that Medicare (not Medicaid) pays for the actual health of the disabled.  It is only the custodial care not provided by family members, or paid for with private funds, that is paid for by Medicaid.

Medicaid is not just for the poor anymore, and the number of disabled people enrolled in Medicaid was 57.1% higher than the number of disabled people who were poor nationwide.  It was 79.4% higher than the number of disabled poor people in New York State, or nearly double, double in California, and more than triple in Massachusetts.  But Utah’s Medicaid enrollment of disabled non-seniors was just 8.0% that state’s total poor disabled non-seniors.

Lest one believe the people of Utah are uncaring, remember that when it comes to the percentage of state residents’ personal income spent on cash welfare, as opposed to social service providers, Utah was number one in the country in the most recent Census of Governments (2017).   You can look it up.

Perhaps there is something to be said for a combination of cash assistance, that could be used for service providers the beneficiary chooses, and family assistance, as opposed to funding for service providers.  In New York, the argument about cash assistance versus social services for the poor goes back far more than a century, according to the books Gotham and Greater Gotham, with no resolution.  If this data is correctly, someone ought to at least be asking what is going on in Utah, and what are the consequences.  

Meanwhile, why were the Democrats unable to renew the refundable Child Tax Credit, a cash benefit that could have been used for child care, or if child care is not needed (because of work schedules, friends and families) for other things?  Why would funding for child care providers – probably with a special higher minimum wage, but not enough funding to include all those theoretically eligible – be more “progressive?”  

Back in Utah, meanwhile, with few disabled non-seniors the spending level per person enrolled is sky high, at nearly six times the U.S. average.  Despite high enrollment, however, New York State’s Medicaid expenditures per disabled enrollee was also very high at 60.9% higher than the U.S. average, and fourth highest in the country.

So New York State residents, who recently (and perhaps not for long) have had a per capita income that was 25.0% higher than the U.S. average, have paid up in the nation’s highest tax burden as a percent of that income, to provide the health care industry with Medicaid spending per Medicaid enrollee that was 22.6% above average for children and 32.7% above average for non-disabled adults, perhaps reasonable, and 88.4% above average for seniors, and 60.9% above average for disabled non-seniors, very questionable.  Despite this, like every other interest in New York, the health care industry is demanding more.

As of 2016, New York reimbursed Medicaid providers at one of the lowest rates of any state in the country, leaving many providers unwilling to provide care for Medicaid beneficiaries. That would remain the case even with the planned increases, said Naomi Zewde, a professor of public health at the City University of New York.

“This doesn’t fundamentally change that and still leaves New York as one of the worst Medicaid reimbursement states,” Zewde said.

If New York has the worst reimbursement rates, as is claimed, then how is it possible that New York’s Medicaid spending per enrollee is up at the top, despite high Medicaid enrollment here?  Perhaps that’s why data like this was MIA for so long.  NY interest groups like to make statements like that without having anyone else be able to check on them.

Nonetheless, like New York City’s UFT-dominated schools, the police, corrections, the transit system, etc., New York’s health care industry apparently owes New Yorkers nothing because the rest of us have cheated it out of $billions.  The fact that, as the prior post showed, New York State’s Medicaid spending equaled 5.06% of the total personal income of everyone in the state in FY 2020, sixth highest in the country behind DC and several states where the residents have much lower incomes, and just the state and local taxes required to fund Medicaid equaled 1.83% of the total personal income of everyone New York State, more than the people of any other state have been willing to pay, apparently gets New Yorkers no credit at all.  After all, how much in campaign contributions do the average New York taxpayer or public service recipient pay to state legislators and the presumptive permanent Governor?  

So no one will stand up for us, and question them.  New York really is the equivalent of those states that refused to expand Medicaid to the working poor.  It just rips ordinary people off, to benefit those working the system, in a different way.