U.S. Sen. John Cornyn stressed how much Medicaid costs Texas state government in a Senate floor speech premised on Republicans leading a successful repeal and replacement of the Obamacare law.
On March 9, the Texas Republican initially declared that state and federal governments “spend an awful lot of money on Medicaid,” the federal-state entitlement program providing health coverage to the poor, especially mothers, children and the disabled, which was launched by Congress in 1965 as part of President Lyndon Johnson’s Great Society.
Cornyn went on: “In Texas, for example, my state spent close to a third of its budget on Medicaid last year, a third of all state spending.”
A reader asked us to check that claim.
We emailed Cornyn’s office to request his backup, then turned to the authoritative May 2016 Fiscal Size-up report from the Legislative Budget Board, which advises state legislators on spending matters. That report, Cornyn spokesman Drew Brandewie shortly advised by email, was the basis of Cornyn’s claim along with other published accounts of Medicaid’s share of the two-year budget approved by the 2015 Legislature.
According to the report, the 2016-17 Texas budget devoted $61.2 billion in funds from all sources, including state and federal aid, to Medicaid, which lately has had a monthly caseload of 4.1 million residents, up from about 2.1 million in 2002— and that amount over the two years running through August 2017 accounted for 29.3 percent of $209.1 billion in All Funds appropriations by the 2015 Legislature.
Federal funds drive Medicaid budgets. That’s because by law, the federal share of a state’s Medicaid expenditures can’t be less than 50 percent, though the share is refined for each state through a formula comparing the state’s average per capita income to the national average. In Texas in fiscal 2016, the federal share broke out to about 57 percent, according to the Henry J. Kaiser Family Foundation. Also, each Texas dollar spent on Medicaid that year was matched by $1.33 in federal aid.
But Cornyn also referred to Medicaid accounting for one third of all “state” spending in 2016.
That’s not correct.
According to the Fiscal Size-up report, the 2016-17 budget allocated $25.2 billion in state general revenue and GR from dedicated accounts — meaning state funds — to Medicaid. Those billions, we calculated, amounted to 22.1 percent of nearly $114 billion in total GR and GR-D spending in the two-year budget.
Separately to our inquiry, Christine Mann of the Texas Health and Human Services Commission shared an agency chart showing Medicaid accounting for increasingly more of the state budget in recent years. According to the chart, Medicaid absorbed about 20 percent of budgeted state and federal funds in 2000. Since 2010, though, it’s drawn on 25 percent or more of the All Funds budget.
We also sought insight from Oliver Bernstein of the budget-savvy liberal-leaning Center for Public Policy Priorities. Bernstein emailed us slightly different figures for what’s likely to be spent on Medicaid through August 2017. He otherwise suggested by email that Medicaid’s heightened share of total spending traces in part to cuts in state support for public schools and institutions of higher education. His point: When other big items get whittled, Medicaid’s budgetary significance grows.
Cornyn said Texas “spent close to a third of its budget on Medicaid last year, a third of all state spending.”
Nearly 30 percent of state plus federal aid in the 2016-17 Texas budget went to Medicaid. A lesser amount of state funds alone, 22 percent by one calculation, was appropriated for Medicaid.
We rate this claim Mostly True.
Texas “spent close to a third of its budget on Medicaid last year, a third of all state spending.”