States by Federal Medical Assistance Percentage (FMAP) For Medicaid

Medicaid is a medical service program administered by the state but created by the federal government in the US. The main aim of the program is to provide the essential medical services for citizens who earn a low income. For one to qualify for Medicaid, they must meet certain asset standards and federal income and also fit into a particular eligibility. According to federal rules, the Department of Health and Social Services (DHSS) has the power to put a limit to medical services as long as the provided services are sufficient in scope, amount, and duration so as to meet the medical needs of the program's beneficiary.

States by Federal Medical Assistance Percentage (FMAP) For Medicaid

The Evolution of Medicaid

Initially, Medicaid started as a program that pays health care for people who were needy and not able to work. Medicaid also catered for the disabled, aged, single-parent families, and blind. However, as years went on, Medicaid started expanding thus covering more people. For example, pregnant women, children, and families with underemployed parents may qualify. There have been changes in rules that determine eligibility for Medicaid specifically for persons in need of the level of health care provided in an institution. A good example of such is a nursing home. Currently, Medicaid is primarily the main payer for nursing homes, covering six in ten residents in nursing homes. One in every three elderly people turning 65 years will need nursing home care at some point. Medicaid also plays a major role for persons suffering from mental health conditions, non-elderly veterans, persons in rural America among others. In other states such as Alaska, the Medicaid program allows some of its beneficiaries who need an institutional level of care to be catered to at the luxury of their own homes.

How is Medicaid Financed?

Both the states and federal governments act jointly to finance Medicaid. The federal government is responsible for paying between 50% and 74% of all medical services costs beneficiaries under the program incur; this is in accordance with federal Medicaid law. However, the FMAP rates vary from one state to another depending on the state's per capita income. According to long-standing regulations, provider taxes are an intrinsic source of funding for Medicaid. Under current regulations, states are not permitted to use provider tax revenues for the state share of Medicaid expenditure unless the provider tax can meet three of the following requirements: cannot hold providers harmless from the burden of the tax, must be broad-based, and uniformly imposed.

Top States in the US by FMAP

According to the Kaiser Family Foundation (KFF), Mississippi is the top state in the US by FMAP for Medicaid with 75.65%. West Virginia is the state with the second highest FMAP for Medicaid at 73.24%, while New Mexico follows in closely at third place with 72.16%. Other states with significantly high FMAP for Medicaid include South Carolina, Alabama, Idaho, Kentucky, Arkansas, Utah, and the District of Columbia.

States that are most at risk from Medicaid cuts

In reality, all states in the US could be affected by the reduction in federal funding, especially for medical health services. However, states with certain characteristics are prone to suffer more from the reduction than others. States that have limited Medicaid programs could face more difficulties in terms of coping with cut back in grants or per capita caps. On the other hand, some of the states with expanded Medicaid could face severe disruption in coverage and financing compared to others.