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DHS seeks $251 million supplemental for Medicaid as GLP‑1 drug spending drives rate increases
Summary
Secretary Dr. Valerie Arkoosh told appropriators the department requests a $251 million supplemental to cover higher-than-expected Medicaid costs in 2025 and that GLP‑1 drugs added about $1.2 billion to managed-care rates for 2025; lawmakers pressed on long-term growth projections.
Secretary Dr. Valerie Arkoosh told the House Appropriations Committee on March 12, 2025, that the Department of Human Services requests a $251,000,000 supplemental to cover unexpected Medicaid costs in fiscal 2025. She said the shortfall reflects unusually high utilization and higher acuity among remaining enrollees since the post‑COVID unwinding, higher hospital and drug costs, and calendar-year rate-setting mismatches with the state fiscal year.
Why it matters: Medicaid is the largest component of the DHS budget and covers “a little over 3,000,000 Pennsylvanians,” Arkoosh said.…
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