U.S. House Committee on Oversight & Government ReformSubcommittee on Health Care, District of Columbia, Census and the National Archives andthe Subcommittee on Regulatory Affairs, Stimulus Oversight and Government SpendingApril 25, 2012
Chairmen Gowdy and Jordan, Ranking Members Davis and Kucinich, and Members of theSubcommittees, thank you for the invitation to discuss the Centers for Medicare & Medicaid
over Medicaid’s financial management.
Medicaid is the primary source of medical assistance for millions of low-income, disabled, andelderly Americans and is a central component of our n
ation’s medical safety net, providing
health coverage to many of those who would otherwise be unable to obtain health insurance. Infiscal year (FY) 2012, an estimated 56.6 million people on average will receive health carecoverage through Medicaid.Although the Federal government establishes minimum requirements for the program, Statesdesign, implement, administer, and oversee their own Medicaid programs. In general, States payfor the health benefits provided, and the Federal government, in turn, matches qualified Stateexpenditures based on the Federal medical assistance percentage (FMAP), which can be nolower than 50 percent. Administrative expenses are generally matched at a 50 percent rate for allStates, although the rate is higher for certain administrative expenditures. On average, theFederal government expects to pay nearly 58 percent of State Medicaid expenditures in FY 2013for Medicaid benefits, and in FY 2013, the Federal share of current law Medicaid outlays isexpected to be nearly $283 billion.States that choose to participate in the Medicaid program and receive Federal matching paymentsare required to cover individuals who meet certain minimum categorical and financial eligibilitystandards. Medicaid beneficiaries include children, pregnant women, adults in families withdependent children, the aged, and people with disabilities who meet certain minimum incomeeligibility criteria that vary by eligibility category. States have the flexibility to extend coverage