Health and Welfare seeks federal authority and transfer exemptions to stabilize Idaho Behavioral Health Plan funding

Alex Williamson, a budget and policy analyst with the Legislative Services Office, told the Joint Finance-Appropriations Committee that the Department of Health and Welfare is asking for a federal supplemental and an ongoing federal operating increase tied to the Idaho Behavioral Health Plan (IBHP).

The request includes a $6,700,000 one-time federal supplemental to allow the department to access grants issued when IBHP went live and $261,400 in ongoing federal operating authority for grants administered by the Substance Abuse and Mental Health Services Administration (SAMHSA). Williamson said the appropriation tied to the original grant year (2022) is no longer usable and the supplemental would give the agency authority to claim those federal dollars now.

The request also included transfer-exemption language. The department asked the committee to approve exemptions to the 10% program-transfer limitations in Idaho Code 67-35-11 for fiscal year 2025 — language that would permit broader internal transfers department-wide to cover adult and children’s mental-health needs in the current year. The governor’s recommendation, Williamson said, would remove transfer limitations beyond those in Idaho Code 67-35-11 for fiscal year 2026.

Director Alex Adams of the Department of Health and Welfare described IBHP procurement and implementation delays to the committee. “I believe this was the largest contract in the history of the state, so I do think it is wise and prudent for the department to do it right versus to do it quickly,” Adams said, adding that legal challenges also delayed the award and implementation. He said federal grants tied to the planned 2022 go‑live remained available but required updated appropriation authority after the program went live in July 2024.

Committee members raised timing and service concerns. Senator Cook asked why the procurement and award took so long; Adams replied that “there was about a year in legal challenges that delayed it as well.” Senator Wintrow pressed the director for his perspective on what had gone well and what stakeholders reported; Adams said budget estimates for IBHP were far off and that “the biggest challenge has been budget,” noting a roughly 60% delta between initial estimates and recent experience.

Adams also explained how the supplemental and ongoing requests intersect with other agency budgets: the enhancement packages presented to the committee are intended to fill gaps left when Medicaid does not cover a service (for example, respite care) or to cover services for people who are not Medicaid eligible, such as some children above 300% of federal poverty level. He described the transfer-exemption request as a tool to allow the agency to move resources to adult or children’s mental-health programs for unforeseen expenditures in the current fiscal year, and said the governor recommended removing additional restrictions beyond statute.

Why it matters: Committee members pressed that the requests affect ongoing service availability. Adams said the department had temporarily suspended some children’s mental-health services earlier in the year to live within existing appropriations and that transfer restrictions limited the agency’s flexibility. The supplemental and transfer authority sought would allow the department to use federal grant funds and internal transfers to stabilize operations without returning repeatedly for emergency appropriations.

The presentation also referenced one-time enhancements made earlier: $3 million for community mental-health funding and $4.4 million one-time to help stand up 988 crisis services (the national crisis line). Williamson said base staffing associated with the division now totals 278.23 FTP after the committee’s prior actions.

The committee did not record a formal vote on the supplemental or transfer-exemption requests during this hearing; they were presented for consideration as part of the budget cycle and noted as supported by the governor’s recommendation.

Looking ahead: Williamson and Director Adams indicated more detailed Medicaid-level discussions on IBHP cost and contract performance would occur during the Medicaid budget hearing scheduled in March.