California’s Medicaid spending on Medicine Services and Procedures climbs to $2.53 billion in 2024

California’s Medicaid expenditures for services categorized under Medicine Services and Procedures reached $2,534,591,855 in 2024, as shown in the U.S. Department of Health and Human Services Medicaid Provider Spending database. This figure reflects an increase of 6.7% from 2023, when payments amounted to $2,375,127,996.

Medicaid is a state-managed public insurance program funded jointly by federal and state governments. It provides coverage to low-income residents, seniors, children and people with disabilities, making it a primary component of the U.S. health system.

Since taxpayer money funds Medicaid, fluctuations in local billing reveal how community public health funds are distributed.

The Medicine Services and Procedures category designates a set of Medicaid-billed services grouped according to care type, using standardized HCPCS and CPT code blocks. For this report, each billing code was placed into a single service category based on specific code prefixes and ranges. This approach groups related services, prevents double counting and allows for consistent rankings over time.

When relevant, categories may encompass several varieties of care. This can include services frequently billed together within Medicaid, like office appointments, diagnostic procedures or therapeutic interventions.

From 2019 through 2024, Medicaid disbursements for California’s Medicine Services and Procedures category rose $1,352,397,217—a 114.4% increase. Certain years, including 2021 and 2023, saw particularly sharp annual jumps in spending.

While Medicine Services and Procedures rates were distributed throughout the state, the highest payments clustered within several ZIP codes. In 2024, ZIP Code 90020 saw the largest total—$292,540,845 (11.5% of the state total); ZIP Code 92503 recorded $59,599,853 (2.4%); and ZIP Code 95128 registered $38,638,724 (1.5%).

Combined, the top three ZIP codes made up 15.4% of all state Medicaid payments for Medicine Services and Procedures in 2024.

Statewide, overall Medicaid spending across all claim categories rose 4.3% from 2023 to 2024.

Throughout various service groups, Medicaid expenditures increased, but the Medicine Services and Procedures category was among the three highest by total payments statewide in 2024.

According to the Centers for Medicare & Medicaid Services, total federal and state Medicaid spending reached approximately $871.7 billion in fiscal 2023, representing around 18% of all national health spending. This is up considerably from about $613.5 billion in 2019, before the start of the COVID-19 pandemic.

This growth—close to 40% in a few years—was fueled by greater enrollment and higher use of services during and following the pandemic.

Recent federal budget measures under the Trump administration have presented significant plans to reduce federal Medicaid funding and reorganize portions of the program. The “One Big Beautiful Bill Act,” enacted in 2025, is expected to cut federal Medicaid spending by over $1 trillion in the next decade and includes policies such as work requirements and higher cost-sharing. This may reduce coverage and support for some beneficiaries, potentially shifting costs to individual states as federal contributions tighten, even as Medicaid continues to cover tens of millions nationwide.

Information for this article comes from the U.S. Department of Health and Human Services Medicaid Provider Spending database. The original data can be found here.