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HHR presenter says Medicaid forecast adds about $3.3 billion; introduced bill includes $612 million in savings measures
Summary
A House Appropriations Committee HHR presenter said Medicaid inflation and utilization add roughly $3.2–$3.3 billion over three years, and staff flagged about $612 million of biennial savings from measures such as suspending biannual inflation adjustments for many providers; staff also noted implementation delays being proposed for the PBM and behavioral‑health redesign.
A staff presenter identified in the briefing as Susan summarized the Health and Human Resources (HHR) portions of the introduced budget and said the Medicaid forecast for inflation and utilization alone is roughly $3.2 billion, rising to about $3.3 billion when the Health Care Fund and related items are included.
"It's about 3,200,000,000 for just the Medicaid forecast of inflation and utilization," the presenter said, and added that including the health care fund and other items brings the total to almost $3.3 billion over the forecast window.
Staff noted that the introduced budget would reduce Medicaid spending by about $612 million across a set of cost containment proposals. The largest single savings item is the elimination of biannual inflation adjustments for several Medicaid provider categories — primarily hospitals and nursing homes — which staff estimated would save about $238 million over the biennium.
The presenter also reviewed several language amendments: a requirement that hospitals receiving enhanced Medicaid payments contract with managed care organizations in each network to ensure access; a supplemental payment authorization for Ballad Health System; and a limit and additional criteria for nursing facility value‑based payments.
On operations, staff said the administration is proposing to delay implementation of the pharmacy benefit manager (PBM) system until Jan. 1, 2027 (the recently received report recommended an 18‑month delay), and to delay elements of the Medicaid behavioral‑health redesign until Jan. 1, 2027; advocates are requesting a one‑year delay.
The subcommittee will examine these cost containment proposals and language amendments in more detail during deliberations.
