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HEHS-95-215R 1 (1995-07-28)

handle is hein.gao/gaobackwx0001 and id is 1 raw text is: United States GAOZ) General Accounting Office Washington, D.C. 20548 Health, Education and Human Service. Division B-262023 July 28, 1995 The Honorable John R. Kasich Chairman, Committee on the Budget House of Representatives Dear Mr. Chairman: Medicaid services and associated administrative costs are jointly financed by the federal and state governments. Some states require local governments to contribute a part of the nonfederal share of Medicaid payments. States receive local government contributions for either Medicaid service costs, administrative costs, or both. This letter responds to your request that we identify in which states, local governments contribute to the nonfederal share of Medicaid service and administrative costs. Medicaid was established in 1965 to provide medical assistance to qualifying low-income people. This jointly financed program accounted for approximately $142 billion in combined federal and state expenditures in fiscal year 1994, with state expenditures of about $61 billion. State Medicaid service and administrative expenditures are matched with federal dollars. The federal matching rate for services for each state is based on the states' per capita income and ranges from 50 to 83 percent. Federal matching funds are not limited by a ceiling or cap. The federal share of administrative costs is 50 percent for all states, with certain exceptions for expenditures for certain functions, such as expenditures for management information systems, which receive enhanced federal matching funds. In fiscal year 1993, service costs accounted for approximately 97 percent of state Medicaid payments, while administrative costs accounted for only 3 percent of state Medicaid payments. To obtain information on local governments that contribute to their state's share of Medicaid costs, we contacted state Medicaid officials in all 50 states. We also contacted the National Association of Counties (NACO) and obtained their most recent data on county participation in GAO/HEHS-95-215R Medicaid: Local Contributions

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