A study published in Health Affairs examines Medicaid spending, finding that the program’s spending growth is due to increased enrollment and noting that Medicaid’s per enrollee costs compare favorably to increases in medical care prices and gross domestic product (GDP).  The authors attribute Medicaid’s success to limits on provider reimbursements, expanded use of managed care, limited use of prescription drugs, and expanded use of community-based programs.  The study also suggests strategies for further cost containment.

Holahan, J. & Yemane, A. (2009). Enrollment is driving Medicaid costs - but two targets can yield savings. Health Affairs, 28(5): 1453-1465. doi: 10.1377/hlthaff.28.5.1453. http://content.healthaffairs.org/cgi/content/abstract/28/5/1453 

Authors: John Holahan, Alshadye Yemane