Nevada Medicaid leaders propose three-part plan to cover $66 million shortfall, including automated PARIS matches and early capitation payment

Richard Whitley, director of the Nevada Department of Health and Human Services, and Stacy Weeks, administrator for the Division of Health Care Financing and Policy, told the Joint Subcommittee on Human Services that the department is recommending a set of budget actions aimed at offsetting a roughly $66 million gap in the upcoming biennium.

The package the department presented includes three principal elements: automating the federal PARIS (Public Assistance Reporting Information System) residency data match, which the division estimates would generate about $20 million in general-fund savings over the biennium; an option to pay an MCO (managed care organization) capitation payment early (moving a July payment into June), estimated to yield about $41 million in state general-fund relief; and a caseload adjustment that reduces projected expenditures by assuming lower enrollment among recent immigrant populations (an estimated 15 percent reduction in that subgroup), which the division estimates will produce additional savings.

Why it matters: the shortfall was identified after an initial budget build and the options would reduce the state’s share of Medicaid costs without cutting core benefits, the agency said. Lawmakers pressed the division on the assumptions behind each estimate and on legal and implementation details.

Details of the three options

- PARIS automation: Weeks said the division currently relies on a manual PARIS match process through the eligibility unit and that automating the PARIS match via a vendor would allow the state to identify out-of-state enrollments more quickly. The division estimated roughly $20 million in general-fund savings over the biennium from automated matches; Weeks said the vendor offered a contingency-fee arrangement beginning July 1.

- Early capitation payment: The division said it has a surplus this fiscal year that could be used to shift the July MCO capitation payment into June, producing about $41 million in general-fund relief over the biennium if members choose that option.

- Caseload adjustment tied to immigration policy: The division proposed reducing its caseload projection for the immigrant population by about 15 percent over the biennium, citing national studies and past experience tied to changes in federal immigration policy. Weeks referenced a prior nationwide finding (Kaiser Family Foundation) showing up to a roughly 30–35 percent disenrollment in a similar period; the division used a conservative half of that impact (15 percent) for Nevada’s projection and offered to share the analytic study with committee members.

Actuarial review and managed care savings

Committee members asked how the division set statewide managed-care savings expectations. Weeks said the division had initially expected more than $40 million in savings from statewide managed care but that a contracted actuary who reviewed post-COVID utilization recommended a more conservative biennial savings estimate of $10 million because longer-term utilization patterns remain uncertain. Jennifer Krepp, the division’s fiscal deputy, said the actuary is a licensed practitioner with prior experience at Milliman and that the savings are expected to materialize more in the second year of the biennium.

Lawmakers’ questions and fiscal office input

Legislators pressed the division on data supporting the PARIS estimate, on how the 15 percent caseload adjustment was derived, and on the decision to treat a one-time fund surplus as a possible source for recurring obligations. Tiffany Greenmaier from the Governor’s Finance Office told the committee the current expected Medicaid reversion is about $21 million for the present fiscal year and outlined how the early capitation payment option would affect the sequence of capitation payments into fiscal 2026.

What the department recommended to the committee

Weeks presented the three options together as a package members could accept in whole or in part. She emphasized the department’s preference for conservative budgeting (i.e., undercounting potential savings rather than overestimating them) and offered to provide the committee with the studies and actuarial analyses referenced during the hearing.

Ending

Committee members voiced follow-up requests for the actuarial reports and the PARIS automation vendor contract. No formal vote was recorded during the hearing; the division said it would provide additional documentation to the subcommittee for further consideration.