New Hampshire officials brief lawmakers on Medicaid program size, financing and risks

State officials from the New Hampshire Department of Health and Human Services told members of the Legislature’s Division III Finance committee on Oct. 10 that Medicaid is a relatively small but essential safety-net program in the state, covering roughly 84,000 residents and accounting for a large and growing share of certain health-care costs.

Anne Landry, associate commissioner at the Department of Health and Human Services, opened the presentation by saying, “Medicaid is vital to the care we provide to our public and, and understanding the nuances of it, is important for us.” The department’s presenters — Henry Lippman, the state’s Medicaid director, and Jonathan Ballard, the department’s chief medical officer — walked members through enrollment trends, coverage categories, what services are covered, and how the state finances the program.

Why it matters: Medicaid represents a significant portion of state-managed health spending and shapes costs across the commercial insurance market. Lawmakers asked questions about enrolled populations, postpartum coverage, school-based billing, pharmacy spending and the potential federal-policy changes that could raise state costs or reduce available federal match.

Officials said New Hampshire’s program is small compared with many states. Landry and Lippman said about one in seven state residents are enrolled (roughly 84,000 people at the time of the presentation), versus roughly one in five nationwide, and that New Hampshire’s enrollment mix is shaped by demographic and income differences. The department reported roughly 65% of adult Medicaid recipients in New Hampshire work, and only about 22% of births in the state are covered by Medicaid — lower than national averages.

The presenters reviewed eligibility rules and income thresholds that determine coverage. Lippman described the Granite Advantage program (the state’s Medicaid expansion population) as having income eligibility at 138% of the federal poverty level and noted that eligibility rules produce “cliffs” for individuals who are only income‑based eligible: a person who crosses the income threshold may lose Medicaid without an alternative through the program itself. Children’s eligibility is far more generous: New Hampshire’s children’s income threshold is among the highest in the country, the department said (presenters cited a 323% federal poverty‑level threshold for children).

Postpartum coverage and maternal mortality: The department stressed a recent policy change that expanded postpartum Medicaid coverage from 60 days to 12 months. Henry Lippman said of deaths within 12 months of delivery, “the majority of those deaths were as a result of either substance use disorder or suicide,” noting that many such deaths occurred after the prior 60‑day coverage window. The state implemented a state-plan amendment in October 2023 to extend postpartum coverage; the department said it is collecting utilization and outcomes data and will report such figures to legislative oversight committees as they become available.

Medicaid and schools: Committee members asked at length about the Medicaid‑to‑schools program and how school districts bill for services. Landry and Ballard emphasized that Medicaid reimbursement to schools is limited to health‑related services that support a student’s individualized education program (IEP) or equivalent plan and that parental consent is required before schools bill Medicaid. “This is not a health care clinic within a school system,” Landry said, adding that Medicaid funds cover services required by the school plan (speech, occupational therapy, physical therapy, certain nursing services and related supports) rather than general school health visits. The department said about 72 of New Hampshire’s roughly 78 school districts currently participate in school‑based Medicaid claiming and that the state is implementing a new cost‑reporting methodology so schools can claim federal match on a closer-to‑actual‑cost basis beginning with a transition through state fiscal 2026.

Financing, federal match and provider payments: The presenters reviewed how payments are shared between state and federal governments (the FMAP/FFP concept) and explained that different services and programs can carry different federal matching rates. They described a mix of funding mechanisms the state uses, including: the state plan (regular Medicaid payments), 1915(c) waivers for home‑ and community‑based services, Section 1115 demonstrations, provider taxes and directed payments, and the disproportionate‑share hospital (DSH) program. Lippman noted that certain directed‑payment tools and rate designs can draw a higher federal match than traditional DSH payments, but also that the higher‑match mechanisms can only be used for Medicaid enrollees (and generally not for uncompensated care for uninsured or out‑of‑state patients).

Officials warned the committee about several near‑term federal risks that could increase state costs. Those included proposals being discussed in Congress and the administration to change the Medicaid expansion matching rate (Granite Advantage), to lower the FMAP floor for wealthier states, to rework DSH or to move Medicaid toward block‑grant or per‑capita caps in some proposals. The department said those changes — if enacted — could shift substantial costs to state general funds.

Pharmacy and high‑cost drugs: Department staff highlighted pharmacy as the fastest‑growing component of Medicaid spending. Ballard and Lippman said prescription drugs now represent roughly 25–31% of total Medicaid medical spending, once drugs administered in hospital settings are included. The department said it has taken steps in its newest five‑year managed‑care contracts to shift funds toward primary‑care medication reviews, implement common formularies and create risk‑sharing and high‑cost pools for new, expensive cell and gene therapies and other specialty drugs.

Managed care, waivers and long‑term services: Officials reiterated that most Medicaid enrollees are served through three managed‑care organizations (MCOs) and that a small number of beneficiaries (about 2,000) remain fee‑for‑service for legal or clinical reasons. The department described numerous waivers and authorities it uses — including 1915(c) home‑and‑community waivers and 1115 demonstration authority — to deliver services not in the regular state plan (for example, Choices for Independence and other long‑term services). The presenters noted past legislative restrictions have kept certain long‑term services outside MCO contracts; the department said the Legislature could change that, but any move to put long‑term supports into managed care would require careful vetting given county and provider funding arrangements and access concerns.

Committee requests and next steps: Lawmakers asked for follow‑up materials; department presenters agreed to provide written lists and “cheat sheets” of program names, eligibility thresholds, and school‑claiming details. The department also committed to returning to the committee for follow‑up briefings (members tentatively scheduled more presentations on nursing facility financing, developmental services and other items).

Ending note: Presenters said New Hampshire’s Medicaid program sits at the intersection of state policy, federal funding rules and rapidly changing medical technology and drug pricing. They asked lawmakers to consider the potential fiscal impacts of federal changes and to coordinate as policy proposals evolve.