Phoenix sees 169.9% increase in Medicaid payments for Medicine Services and Procedures in 2024

According to the U.S. Department of Health and Human Services Medicaid Provider Spending database, Medicaid providers in Phoenix submitted $32,563 in claims for services categorized under Medicine Services and Procedures in 2024. This represented an increase of 169.9% from 2023, when claims reached $12,065 for the same services.

Medicaid is operated by state governments and funded jointly with the federal government. It provides coverage for low-income individuals, families, seniors, children and people with disabilities, making it one of the largest segments of the national health care system.

As Medicaid payments are taxpayer-funded, fluctuations in local billing levels reflect how public health care resources are distributed in a community.

The Medicine Services and Procedures category includes groupings of Medicaid-billed services determined by the care provided, following standardized HCPCS and CPT code groupings. For this review, each billing code was mapped to a single service category using established code prefixes and numerical ranges so related services could be analyzed collectively, aiding in precise tracking without overlap or duplication across years.

While Medicaid outlays increased across multiple service groups, Medicine Services and Procedures led all categories in Phoenix for total Medicaid payments in 2024.

In Oregon, Medicine Services and Procedures held the third spot statewide for total Medicaid payments in 2024.

Over the previous five years, Medicaid payments connected to Medicine Services and Procedures in Phoenix rose by $31,888, or 4723.9%. The pace of growth was especially significant in certain periods, such as 2023 and 2020, when year-over-year upticks were notable.

Spending for Medicine Services and Procedures spanned the city but was concentrated within just a few ZIP codes. In 2024, ZIP code 97535 accounted for $32,563 in payments. The top ZIP code made up 100% of Medicaid payments for Medicine Services and Procedures in Phoenix throughout the year.

For this category, Medicaid payments were mostly associated with a small set of specific billing codes.

Comparing years, Medicaid payments for Medicine Services and Procedures in Phoenix soared by 169.9% from 2023 to 2024, while all other Medicaid claim categories in the city saw a 43% shift during the same timeframe.

According to the Centers for Medicare & Medicaid Services, combined state and federal Medicaid spending totaled approximately $871.7 billion in fiscal year 2023, representing around 18% of all U.S. health spending, a significant increase from roughly $613.5 billion in 2019, prior to the COVID-19 pandemic.

This reflects a growth rate of about 40% over just a few years, largely attributed to increased enrollment and greater service use during and following the pandemic era.

Federal budget legislation enacted during the Trump administration included proposals for major reductions to federal Medicaid funding and program restructuring. The “One Big Beautiful Bill Act,” signed into law in 2025, is estimated to cut federal Medicaid spending by more than $1 trillion over the coming decade, and adds measures such as work requirements and greater cost-sharing, potentially reducing coverage or funding for certain beneficiaries. These policies are expected to shift increased costs to states and constrain federal Medicaid growth, although the program continues to cover tens of millions nationwide.

Note: HCPCS codes are shown for context within the category. Category totals and rankings in this article are based on standardized service groupings rather than individual billing codes.

Information in this article was obtained from the U.S. Department of Health and Human Services Medicaid Provider Spending database. The source data can be found here.