Comparison of Health Care Spending and Utilization Among Children With Medicaid Insurance

Abstract

Background and objectives: Opportunities to improve health care quality and contain spending may differ between high and low resource users. This study's objectives were to assess health care and spending among children with Medicaid insurance by their resource use.

Methods: Retrospective cross-sectional analysis of 2012 Medicaid health administrative data from 10 states of children ages 11 months to 18 years. Subjects were categorized into 4 spending groups, each representing ∼25% of total spending: the least expensive 80% of children (n = 2,868,267), the next 15% expensive (n = 537,800), the next 4% expensive (n = 143,413), and the top 1% (n = 35,853). We compared per-member-per-month (PMPM) spending across the groups using the Kruskal-Wallis test.

Results: PMPM spending was $68 (least expensive 80%), $349 (next 15%), $1200 (next 4%), and $6738 (top 1%). Between the least and most expensive groups, percentages of total spending were higher for inpatient (<1% vs 46%) and mental health (7% vs 24%) but lower for emergency (15% vs 1%) and primary (23% vs 1%) care (all Ps < .001). From the least to most expensive groups, increases in PMPM spending were smallest for primary care (from $15 to $33) and much larger for inpatient ($0.28 to $3129), mental health ($4 to $1609), specialty care ($8 to $768), and pharmacy ($4 to $699).

Conclusions: As resource use increases in children with Medicaid, spending rises unevenly across health services: Spending on primary care rises modestly compared with other health services. Future studies should assess whether more spending on primary care leads to better quality and cost containment for high resource users.

FIGURE 1

Distribution of spending for health care services by spending group for children in Medicaid.