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Legislative analysts flag $235M Medicaid growth; governor's options include provider-rate cuts and $67M contingent reductions
Summary
Legislative staff told the Health and Welfare Committee the Medicaid forecast shows roughly $235 million in ongoing growth; presenters cited a 4% provider-rate cut (about $84.8M) already implemented and a $67M package of governor-recommended reductions that would require legislative action.
Alex Williamson, Budget and Policy Analyst with Legislative Services, told the committee the Medicaid division faces an overall forecasted increase of about $235,000,000 and walked members through fund-source and plan-level drivers. "Today I'm going to talk a little bit about Medicaid, specifically, the optional cuts as recommended by the governor," she said as she began a slide-driven presentation.
Williamson showed how caseload, pricing and utilization increases drive most of the forecasted growth and explained which funding sources (general, federal, Dedicated Funds) bear those costs. She broke out an $84,800,000 effect tied to a 4% provider-rate cut already implemented and described a separate $67,000,000 package of governor-recommended reductions that "has not been implemented yet because it's dependent on the legislature making some decisions about policy changes," including roughly $22,000,000 from the general fund and about $45,000,000 from federal funds. Williamson listed potential legislative options: deeper hospital rate reductions beyond the 4 percent, reducing residential habilitation rates, evaluating MCO administrative costs, and removing certain services currently in statute.
