Part II: Child Medicaid Spending A Roadmap to Saving $128 Million in Maine Medicaid without Dropping Coverage for One Child.

Read the full report | In 2004, Maine had the second highest spending per child Medicaid beneficiary of the 50 states and the District of Columbia, spending 136 percent more per child Medicaid beneficiary than the U.S. average.  Maine spent $3,592 per child, while the U.S. average was $1,525, and the average for the other New England states was $2,601.Maine Medicaid spent over $403 million to cover 112,300 kids. The Maine child enrollment rate was the seventh largest in the country, despite Maine having a below average rate of children in poverty.

In the five years from 1999 to 2004, spending per child beneficiary grew by 45 percent in Maine, twice the rate of medical inflation, compared to the U.S. average growth of 32 percent. Inpatient, outpatient, clinic, drugs, and targeted case management spending were the major cost drivers in per beneficiary Medicaid child spending growth from 1999 to 2004. During this same time, the rate of children without health insurance slightly decreased to 5.8 percent in 2004, from 6.5 percent in 1999.

Maine Medicaid could save almost $232 million if spending for every child on Medicaid was at the U.S. average spending.

Maine could save $111 million if Medicaid spending for every child was at the average for the other New England states.

• Maine spends more than six times as much on mental and behavioral health services for children than the U.S. average – $1,344 per child Medicaid beneficiary compared to $216 Average mental and behavioral spending would save Maine Medicaid $127 million.

• Maine spends 69 percent more on major medical care per child Medicaid beneficiary than the U.S. average – $1,832 compared to $1,082. Having average spending in this area would save $84 million. Maine’s spending in this area is about the same as the other New England states.

• Maine spends 86 percent more on prescription drugs per child Medicaid beneficiary than the U.S. average – $243 to $130. Average spending would save Maine Medicaid $12.6 million.

There are several immediate steps policymakers should take to reform Maine Medicaid for children, making Medicaid more affordable and sustainable. The three reforms for children, discussed at the end of this report, could save Maine Medicaid up to $64 million a year, which is $128 million over the biennium. State funds amount to $47 million over the biennium.