Legislative fiscal staff warns DPHHS shortfall driven by state hospital costs and Medicaid growth as providers plead to protect rate increases

Summary

Legislative fiscal staff told the finance committee that a proposed DPHHS supplemental transfer is driven by higher-than-budgeted state hospital costs and Medicaid spending; dozens of providers urged lawmakers not to cut optional benefits or freeze provider rate increases, warning it would reduce access and shift costs to hospitals.

Legislative fiscal staff told the Legislative Finance Committee on May 6 that a proposed supplemental appropriation and inter‑year transfer for the Department of Public Health and Human Services (DPHHS) is driven primarily by higher operating costs at state psychiatric facilities and by Medicaid spending that outpaces current appropriations.

Josh Platt, fiscal division, said the executive requested transfers that would move authority from the second fiscal year into the first: “$7,000,000 general fund, $34,200,000 state special, and $146,300,000 from the second fiscal year to the first fiscal year,” and that two principal drivers are state‑operated facility costs and Medicaid program growth. Platt and his colleagues presented charts showing volatile post‑public‑health‑emergency Medicaid enrollment and higher provider rate adjustments passed in prior sessions.

Julie Hamilton, fiscal staff, told the…

Legislative fiscal staff warns DPHHS shortfall driven by state hospital costs and Medicaid growth as providers plead to protect rate increases

Summary

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