One explanation is that medical spending essentially increases on autopilot while spending on nonmedical services generally does not. State governments know the federal government will match their Medicaid spending. The federal government will do no such thing if a state government, say, provides subsidized employment opportunities for people who've just left prison. The things government does to help people that don't involve modern medicine--the policies that get people back to work, give them the skills they need, help them deal with the challenges of raising young children, and much else--are funded by a grab bag of programs that have seen their funding grow slowly, if at all. Some of these programs work well, and many others do not.