Fiscal Focus Quarterly

              FISCAL FOCUS QUARTERLY
QUARTERLY • SEPTEMBER 2004 ISSUE
MAY 2005
The Medical Assistance program, usually called Medicaid, is
a health care program that provides medical assistance for cer-tain
individuals and families with low incomes and resources. Med-icaid
was authorized under Title XIX of the Social Security Act and
became law in 1965 as a jointly-funded cooperative venture between
the federal and state governments. By 2003, Medicaid had grown to be the
largest health care program in the nation totaling $278 billion in expendi-tures
and providing health care services to an estimated 47 million persons
including seniors, people with disabilities, children, pregnant women, and low-income
families.
In the period from 1995 to 1998, Medicaid costs grew at an average annual rate
of 3.6%, the lowest rate in the program’s history. Since then, costs have been on an
upswing, and from 2000 to 2003, Medicaid costs grew at a rate of 10.2%. According
to the Fiscal Survey of States, fiscal year 2005 budgets proposed by state governors esti-mated
state fund expenditures would have to increase 12.1% to meet Medicaid needs. Unfor-tunately,
these increases have occurred when the economy was experiencing a downturn. The
fiscal problem being faced by the states is that Medicaid enrollment and spending tend to
increase during difficult economic times, and those are the same times that state revenues
dependent on the economy tend to stagnate or decrease.
QUARTERLY • MAY 2005 ISSUE DANIEL W.HYNES
STATE OF ILLINOIS COMPTROLLER
Comptroller Hynes’ office strives to assist taxpayers
and the people of Illinois. This report is designed
to provide fiscal information of general interest.
COVER STORY continued, page 5
Medicaid Continues
to Challenge State
Budgets