Who funds Medicaid?

• A. Joint state and federal government
• B. State governments alone
• C. Private insurers
• D. Local and tribal governments

Answer: (A)

Medicaid is funded through a shared financing arrangement between the federal government and the states. The federal government provides a large, variable match to each state's Medicaid spending through FMAP (the federal medical assistance percentage). The exact federal share depends on the state (and, under the ACA, on whether people are in the expansion population), so poorer states typically receive a larger federal contribution. The rest of the cost is covered by the state using its own funds. Local and tribal governments don’t fund Medicaid on their own, though they may administer programs or contribute in some ways; the financial support ultimately comes from the federal and state governments working together.