Medicaid eats up at least 17 percent of state budget and number could grow


Tom Schultz, director of the Idaho Department of Lands, told a legislative interim committee that investments from the endowment lands produced a record return in fiscal year 2014.

After a number of years of expending less on Medicaid as a share of the whole budget, Idaho is set to keep funds for the program at more than 17 percent of total state spending for the second straight year.

Department of Health and Welfare officials are asking for $44 million more in state funding next year, bringing the total allotment to $481 million if approved.

If lawmakers OK that amount, it would represent the greatest share dedicated to Medicaid in recent years. The $481 million would represent 17.17 percent of the governor’s proposed $2.8 billion budget for 2013.

If lawmakers provide a conservative estimate for state revenues, it’s possible that percentage could jump even higher, though the $44 million request isn’t a sure thing.

Medicaid is typically seen as a medical services safety net. More than 230,000 Idahoans utilize Medicaid services, with the majority of them being children. Medicaid covers basic services, like some doctor visits, therapy, some chiropractic and emergency dental work.

In 2007, the state spent $340 million on Medicaid, representing 13.9 percent of that year’s $2.57 billion budget. The low point of the last few years came in 2009, when the state spent $327.5 million on Medicaid, amounting to 12 percent of that year’s spending.

Even with the added $137 million to 2012 Medicaid spending, which brought the program’s yearly total to $436 million, Idaho spent 17.09 percent of its $2.55 billion budget on the program.

The state money is $15 million less than it could have been, however. Medicaid is a shared expense, meaning the state picks up a portion and the feds cover the rest. Traditionally, the split works out to the state paying 30 percent and the feds paying 70. In fiscal year 2013, the federal government’s share will jump from 69.86 percent to 70.81 percent, saving the state $15 million.

In all, Medicaid is asking for $1.978 billion for 2013, with an increase of $161 million, including state, federal and dedicated funds.

Rep. Steve Thayn, R-Emmett, a member of the House Health and Welfare Committee, says he is “not at all” comfortable with expansion of the Medicaid budget. Thayn, who gave a presentation on cutting health care costs to his panel Monday, said the Medicaid budget hurts other state programs, like roads and public education.

“It’s consuming other state budgets,” Thayn said.

The Emmett Republican is exploring legislation to cap Medicaid spending as a share of the state budget, but didn’t indicate what that percentage might be. He said that a cap could be phased in over time with smaller, multi-year reductions.

If implemented, Medicaid funding would be set as a percentage of the state’s yearly budget and policymakers would be forced to work within that figure.

Thayn didn’t say if the legislation might come this year.

Rep. Darrell Bolz, R-Caldwell, a vice chair of the budget committee, told IdahoReporter.com he is concerned with Medicaid’s rising costs, but doesn’t believe a hard cap on the program is the correct answer. “I don’t like putting percentages on things,” Bolz said, adding that budget fluctuations are too volatile for hard caps to be instituted.

Bolz blames the economy for the skyrocketing Medicaid costs, but he wants lawmakers to work to address health expenses. “We cannot continue to have costs escalate,” Bolz warned.

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The budget committee heard about Medicaid spending Tuesday., The budget committee heard about Medicaid spending Tuesday.
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  1. Pingback: MEDICAID EATS UP AT LEAST 17 PERCENT OF STATE BUDGET AND NUMBER COULD GROW | Idaho Center for Fiscal Policy

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