Although healthcare spending by states varies dramatically, they all can agree that they have been spending more on Medicaid during the past three years, according to a report by the National Association of State Budget Officers (NASBO) released Tuesday.

Medicaid spending, excluding administrative costs, reached almost $398.6 billion in fiscal 2011, up 10.1 percent from the year before.

States have been designating more of their budgets to the federal entitlement program, which accounted for 23.6 percent of all state expenditures this year, the report notes. That's a steady increase from the 21.9 percent in 2009 and 22.3 percent in 2010.

That increase is due in part to a significant jump in enrollment, which rose an average 5.5 percent this year. According to the NASBO, states expect enrollment to grow another 4.1 percent in 2012.

Virtually every state created at least one new Medicaid policy in an effort to curb costs in 2011. Many of them cut provider reimbursement rates (with even more planning to next year), while others eliminated benefits.

The future of Medicaid remains unclear. As health reform provisions start to kick in, states must find ways to upgrade eligibility systems, accommodate new beneficiaries, and overcome the lack of administrative resources and staff to implement reform, all while trying to contain costs, the NASBO warns.

For more information:
- here's the NASBO report (.pdf)
- read the NYT article
- here's the Reuters article

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