Report: Medicaid growth modest

By Kay Lazar, Globe Staff

Massachusetts spending on Medicaid programs has grown only slightly faster than the state's economy over the past decade, with the biggest growth coming during tough economic times, a new report finds.

Medicaid spending grew at an average annual rate of 7.1 percent, while Massachusetts total personal income grew at an annual rate of 6.2 percent during that period between 1996 and 2007 fiscal years, according to the report from the Massachusetts Medicaid Policy Institute and the Massachusetts Budget and Policy Center.

But the meltdown on Wall Street may force employers to lay off workers or cut health insurance benefits, forcing more residents to seek state-subsidized health care, and that could swell Medicaid spending, said Anya Rader Wallack, executive director of the Institute.

"Over the past couple of years, employer coverage has been pretty robust compared to a lot of other states and the nation," Wallack said.

Medicaid enrollment grew from 715,000 in 1996 to 1.1 million in 2007, as the state gradually expanded eligibility for the program. The latest expansion came in 2006, when the state overhauled its healthcare system with a new law that has added roughly 240,000 more people to the program.

The state has been locked in delicate negotiations with federal officials over continued funding of its Medicaid program. Massachusetts has requested about $11 billion over the next three years to keep its landmark health care law and many other programs afloat.