On June 27, the Department of Health Services submitted a quarterly report to the Joint Finance Committee on the overall condition of the Medicaid benefits budget.
The report shows an estimated $93 million GPR shortfall ($232.5 million All Funds) by the end of the biennium, a nearly $73 million increase to the projected shortfall from last quarter.
The shortfall is attributed primarily to two factors; higher than anticipated enrollment among childless adults and lower than expected federal Medicaid revenues for costs incurred by county-owned nursing homes.
The biennial budget bill assumed that childless adult enrollment would reach 99,000 by the end of the biennium (June 30, 2015). Through May, 2014, 103,126 individuals have been enrolled and the department’s new estimates now assume enrollment will reach 135,000 by June 2015.
Faster than anticipated growth in childless adults is partially offset by lower than projected growth for BadgerCare Plus parents and children. Combined, the enrollment factor accounts for $59 million GPR of the shortfall, compared to the March projection.
With regard to county nursing homes – the budget assumed that county home costs would continue to grow each year per trend over the past several years. Recently received data shows that most home costs have stayed flat or decreased from the previous year. Based on the lower than expected costs, the department has revised the amount of federal supplemental funding it expects to receive for county homes by $35 million over the biennium.
The Medicaid program is budgeted at $4.8 billion for the biennium and the current projected shortfall of $93 million is less than two percent of total expenditures. The department included a status report on a number of ongoing waste, fraud and abuse reduction strategies as illustrations of its overall effort to be within budget at the end of the biennium.