Introduction: Heart disease (HD) poses a significant health and economic burden in the United States, with considerable variations in outcomes across different racial and ethnic groups. The COVID-19 pandemic has further highlighted disparities in healthcare utilization and costs associated with HD. ac Methods: We used the 2021 Merative MarketScan Medicaid claims database to estimate medical costs and healthcare utilization associated with HD by racial and ethnic groups and COVID-19 diagnosis status. Our study focused on individuals aged ≥18 years old continuously enrolled in a non-capitated insurance plan in 2021. The outcome measures included total medical expenditures and healthcare utilization, including numbers of emergency department (ED) visits and inpatient admissions, and length of inpatient stay. We employed a generalized linear model with a family of gamma and log links was used for medical costs, and a negative binomial regression for healthcare utilization. Three-way interactions of HD, COVID-19 diagnosis, and race and ethnicity categories were implemented after adjusting for age, sex, and comorbidities. We reported average marginal effects with 95% CIs. Results: Among 1,008,166 Medicaid beneficiaries, 8% had HD in 2021. The cost associated with HD was $10,819 per beneficiary in 2021 (95% CI, 10,292–11,347; P<0.001). The cost was $15,840 (95% CI, 14,389–17,291; P<0.001) for non-Hispanic Black individuals, $9,945 (95% CI, 9,172–10,718; P<0.001) for non-Hispanic White, and $8,511 (95% CI, 7,490–9,531; P<0.001) for Hispanic individuals. Individuals with a COVID-19 diagnosis ($19,638) had $9,541 (95% CI, 7,049–12,032; P<0.001) higher costs associated with HD than those without COVID-19 ($10,098) (P<0.001). Individuals with HD had higher numbers of ED visits (0.937 per beneficiary, 95% CI, 0.913–0.960), inpatient admissions (0.463 per beneficiary, 95% CI, 0.455–0.471), and average length of stay (2.541 days per admission, 95% CI, 2.405–2.677) than those without HD. Conclusions: Our findings showed that costs and healthcare utilization associated with HD are substantial in all racial and ethnic groups and the highest among non-Hispanic Black individuals. Furthermore, individuals with a COVID-19 diagnosis had approximately two times higher costs associated with heart disease compared with individuals without a COVID-19 diagnosis.