Medicaid

Medicaid is a U.S. governmental program that is funded by federal and state (and, in some cases, [Page 738]local) governments, is administered by the states under federal guidance, and is intended to cover the costs of medical and other healthcare-related services for the poorest of America's citizens. It was enacted in 1965, exemplifying the government's concern about access to medical care for two large segments of the U.S. population—the elderly and the poor. Buried within legislation enacting Medicare (as Title XVIII of the Social Security Act), through which federally supported health insurance was extended to the country's elderly, Medicaid (as Title XIX of the Social Security Act) was enacted as part of the continuing efforts of the federal and state governments' limited efforts to fund medical care for various categories of needy people. Originally enacted as an optional program (i.e., there was no mandate by the federal government requiring that individual states implement Medicaid), it was not until Arizona implemented its Medicaid program in 1982 that all states (and the District of Columbia and other U.S. territories) provided Medicaid coverage to eligible individuals. As of 2006, 43 million low-income individuals were recipients of Medicaid coverage.

Medicaid, like other public and private health insurance programs in the United States, plays an important role in U.S. health policy. The policy decisions inherent in the successful administration of the program can be informed by appropriate application of decision-making tools such as cost-effectiveness analysis and other statistical techniques, especially in the face of limiting resources. This entry provides the reader with an overview of the Medicaid program, including the federal and state governments' role in its administration; the eligibility requirements for receiving benefits and what benefits recipients are eligible to receive; the costs of Medicaid as part of the nation's health expenditures; and the expansion of the Medicaid program through the State Child Health Insurance Program (SCHIP). Last, this entry considers the effect of Medicaid on states' budgets and states' attempts to control the program's expenditures, including the health reforms introduced by the state of Oregon, the centerpiece of which was a prioritized list of services that ranked medical conditions and treatment on the basis of cost-utility analysis and that sparked a national debate on rationing.