Report: U.S. States Streamline Medicaid as Federal Law Forces Changes

A stipulation in the 2010 healthcare law that bans U.S. states from dropping Medicaid patients has forced them to be more efficient in managing the program to save money, according to a new report.

While Medicaid, the joint U.S.-state health plan for low-income people, is among the biggest expenses for states in a flagging economy, the law prevents them from dropping members or tightening eligibility. A Kaiser Family Foundation survey found that 29 states have streamlined their programs, with most using U.S. incentives to add new technology.

States and the federal government were projected to spend about $442 billion combined on Medicaid in 2011, with about 61% covered by the U.S. Twenty-six states challenging the constitutionality of the 2010 law at the U.S. Supreme Court contend the overhaul will saddle them with higher spending when it broadens Medicaid eligibility in 2014.

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Sources: Bloomberg; Kaiser Health News