I found a website that provides a great deal on information on Medicaid.
Did you know that Medicaid is source of funding for nonprofits, and is jointly financed by federal and state governments? The States use it as a source of support for social services programs.
“Every $1.00 that a State spends on Medicaid-eligible social services brings with it at least $1.00 in federal matching funds, with the average State receiving about $1.33 in matching funds.”
“Medicaid reimbursement rates also provide resources for nonprofit social service organizations to cross-subsidize other programs and operations that may not always be adequately funded given [the] demand.”
“Many other sources of social service program funding are fixed or capped, regardless of the number of clients served. But because Medicaid reimbursements follow the client, an agency that serves more eligible clients will receive more money without having to bill clients. Finally, expansion of Medicaid coverage and enrollments in the past few decades has increased the pool of eligible clients for nonprofits.”
As we have seen in the review of some of the agencies under the ADAMHS Board, being a “nonprofit” can be very profitable without the executives assuming any risk of personal investment.