Medicaid short $75 million after unmet appropriation request

JACKSON, MISS– Officials with Medicaid, Magnolia Healthcare, UnitedHealthcare, and the Mississippi State Medical Association met with the joint legislative Medicaid committees to discuss what Medicaid called a shortfall of $75 million in their budget.

Mississippi Division of Medicaid Executive Director Dr. David Dzielak said the requested deficit would have reached $78 million, but enrollment in Medicaid across the state had declined in the last two years.

This brought Senate Medicaid Chairman Brice Wiggins to question why the additional funds were needed if there was a decrease in enrollment.

“I realize this is not an appropriations committee.” Wiggins said. “You’re requesting a $75 million dollar deficit, but you’ve requested a budget over a billion dollars.. but enrollment is going down.”

Dr. Dzielak explained that the drop in enrollment was factored into the request.

“We requested 1.008 billion..in September, all state agencies were cut four percent,” Dr. Dzielak said. “That equaled a 78 (million) deficit.. but since enrollment went down, we’re asking for 3 million less.”

Dr. Dzielak added that not each beneficiary has the same costs.

“There’s not a one-to-one correlation in losing members and cost savings.”

Budget woes have been increased with the spread of the modern-day epidemic, opioid addiction.

“One way Hepatitis C is contracted is through sharing needles,” said Dr. Dzielak, “but we can’t control patient behavior.”

The rising costs of medical care have further increased the financial pinch felt by Medicaid.

“The consumer price index is 2.9 percent. The medical inflation cost is about two times the consumer price index,” said Dr. Dzielak. “Currently, inflation rate is 4%, but Medicaid is only asking for a 2% increase.”

While there are optional services, right now Medicaid is operating as they are required to do.

“We’re running the program exactly how it is outlined in state law,” Dzielak. “We’re doing exactly as you tell us to do.”

 

One of the optional services of Medicaid is the pharmacy service. It is not mandatory. If there is a financial emergency declared by the Governor, Medicaid can cut all optional services.

Over four years, Medicaid has had a budget deficit each year, ranging from $50-$100 million.

“The deficit isn’t from overspending,” said Dr. Dzielak. “It’s from not getting the funds we requested.”

On the political scale, Dr. Dzielak said the repeal of the Affordable Care Act would be costly for Medicaid. They would have to pay an additional 17 percent for Mississippi children on CHIP.

Medicaid asking for $75 million to close out 2017, but the original budget was short $65 million, then a $15 million mid-year cut.