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Medicaid's medical assistance outlays in the U.S. by type of payment 2017

Medicaid’s medical assistance payments totaled approximately 573 billion U.S. dollars in 2017. Capitation payments and premiums accounted for more than half of all expenditures in this category.

What are capitation payments?

Capitation is an alternative payment model to the more traditional fee for service. The capitation arrangement sees an insurer – such as Medicaid – pay a pre-arranged, fixed monthly payment for each enrollee registered with a health care provider. The system also involves the two parties agreeing upon the services that the physician will provide as part of the coverage, and the final settlement is called the per member per month (PMPM) payment.

Determining federal and state shares

Federal and state governments collectively spent around 600 billion U.S. dollars on the Medicaid health insurance program in 2017 – the federal government’s outlays represented a share of around 60 percent. States report their Medicaid costs to the federal government after each financial quarter, and the federal government reimburses states for their expenditures based on a matching rate. The federal government matches at least 50 percent of the program costs, but they will pay a larger share of in poorer states.

Medicaid's medical assistance outlays in the United States in 2017, by type of payment (in billion U.S. dollars)*

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Release date

April 2020


United States

Survey time period

fiscal year 2017

Supplementary notes

* Federal outlays are the funds drawn from the U.S. Treasury by the States. The State and total outlays reflect spending as reported by the States for the purposes of drawing Federal funding from the U.S. Treasury. Expenditures represent the spending as it was paid by the State to health care plans or providers. While expenditures and outlays are generally similar, they are not equal mainly due to the timing differences between the States paying for services and the States receiving Federal funds. Neither outlays nor expenditures include Title XIX costs in support of the Children's Health Insurance Program.
** Benefit expenditures as reported on the CMS-64 (base expenditures).
*** Adjustments include net adjustments of benefits from prior periods and the difference between expenditures and outlays.

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Statistics on "Medicaid/CHIP"

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