Medicaid is one of the largest and fastest-growing items in the federal budget. State and federal spending on the program totaled $931.7 billion in fiscal year 2024, with federal spending growing by more than 80 percent from FY 2016 to FY 2025. This outpaced Social Security (73 percent), Medicare (71 percent), defense (53 percent), and nearly every other spending category over the same period. Medicaid is also highly vulnerable to financial mismanagement with $37 billion in federal improper payments in FY 2025, though actual figures are likely higher. Is Medicaid’s spending growth a direct result of its matching grant structure? While states administer the program, the federal government matches state spending with $1 to $9 in taxpayer funding. This arrangement encourages states to overspend, shift costs to federal taxpayers with financing gimmicks, and tolerate fraud and improper payments.