Ann Arbor sees $27,830,462 in Medicaid payments for alcohol and drug abuse treatment in 2024

In 2024, Ann Arbor Medicaid providers billed $27,830,462 for services in the Alcohol and Drug Abuse Treatment category, according to the U.S. Department of Health and Human Services Medicaid Provider Spending database. This represented a 6.5% rise from 2023, when claims for the same services totaled $26,132,296.

Medicaid, funded jointly by state and federal governments and operated by the states, insures low-income families and individuals, seniors, children and people with disabilities. It is a core component of the U.S. health system.

Since Medicaid is taxpayer-funded, shifts in local billing demonstrate how public health care funding is distributed within the community.

The Alcohol and Drug Abuse Treatment category encompasses a group of Medicaid-billed services as defined by standardized HCPCS and CPT code groupings. In this analysis, each billing code was matched to one service category using consistent code prefixes and number ranges, ensuring related services are reviewed together and preventing duplication in totals or rankings over time.

While several service categories experienced Medicaid spending increases, Alcohol and Drug Abuse Treatment placed second for total Medicaid payments in Ann Arbor in 2024.

Statewide in Michigan, Alcohol and Drug Abuse Treatment was the leading category by Medicaid payment total for 2024.

During the five years before 2024, Medicaid payments in Ann Arbor linked to Alcohol and Drug Abuse Treatment climbed by $8,274,574, or 42.3%. The pace of spending growth increased in certain years, especially in 2022 and 2020.

Spending for Alcohol and Drug Abuse Treatment services was spread throughout Ann Arbor, but most Medicaid payments were concentrated in a few ZIP codes. In 2024, ZIP code 48108 accounted for $15,442,215, ZIP code 48105 recorded $5,825,174, and ZIP code 48103 saw $5,765,839. Collectively, these top 3 ZIP codes made up 97.1% of the city’s Medicaid payments for this category in 2024.

Within the Alcohol and Drug Abuse Treatment category, a small number of individual billing codes accounted for the bulk of Medicaid payments.

When compared year over year, Medicaid payments for Alcohol and Drug Abuse Treatment in Ann Arbor were up 6.5% between 2024 and 2023. By comparison, all Medicaid claim categories in the city rose by 9.2% over the same period.

According to the Centers for Medicare & Medicaid Services, federal and state Medicaid spending together reached about $871.7 billion for the 2023 fiscal year, representing roughly 18% of total U.S. health expenses—a significant increase since 2019’s $613.5 billion, prior to the COVID-19 pandemic.

This nearly 40% growth was mainly driven by increased enrollment and more frequent usage of services during and following the pandemic.

Major federal budget measures approved under the Trump administration have proposed steep reductions in federal Medicaid funding and introduced program restructuring. The “One Big Beautiful Bill Act,” passed in 2025, is set to cut over $1 trillion from federal Medicaid outlays over 10 years, bringing in requirements such as mandatory work and higher cost-sharing. These changes are expected to shift additional costs to the states and limit growth in federal support, though the program remains vital to 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.