ABSTRACT
Medicaid has been expanded under the Affordable Care Act (ACA), and in the Obamacare era, more people applied to Medicaid. The financial model of Medicaid has remained unchanged since it was established. Medicaid plays a role in federal government and the state budget. The state has some flexibility in determining the source of funding for a non-federal share of Medicaid spending. The primary source of funding comes from the state general fund appropriation. Everybody is talking about crash funding, but its correct name is disproportionate share hospital payments (DSH). DSH is a source of finance available to hospitals that serve Medicaid and low-income insurance patients. Medicaid is funded only by the federal government, and the money flows into the state. This is a program for social protection and social insurance. In 2014, the implementation of major ACA coverage expansions required an increase in funding for Medicaid because more people were applying for insurance.
