With the sharp holdbacks already imposed at the Department of Health & Welfare, the department may not need a $20 million supplemental appropriation for Medicaid this year after all, Medicaid administrator Leslie Clement told legislative budget writers. She said agency officials hope to work with lawmakers on that. "It looks like we may not need this request funded because of the holdbacks," she said of the $20.6 million supplemental appropriation request. If it is needed, she said, "It would be for less."

Overall, however, Clement warned that cutting Medicaid doesn't pay off during tough times. "In economic downturns, the corresponding loss of federal funds magnifies the impact of state fund reductions," she noted. "Generally, for every $3 reduction in state funds, $7 is returned to the federal government." So cutting state funding for Medicaid means losing the federal funds, too, which has twice the impact because Idaho gets about $7 from the feds for every $3 it spends on Medicaid. Certain Medicaid programs are federal requirements, Clement told legislative budget writers. Some states offer lots of optional programs, too, but Idaho offers few. "We are the third most restrictive state in the nation relative to eligibility," she said. Among the optional categories: The Children's Health Insurance Program, or CHIP, which now has 27,000 Idaho children enrolled. The Katie Beckett medically needy program enrolls 2,100 children. Twelve thousand adults receive community-based services.

Gov. Butch Otter's budget recommendation for Health & Welfare is based on an estimate that the federal Medicaid match rate will be increased by 4 percent - about $40 million - as part of the federal economic stimulus package. If that doesn't happen, Senate Finance Chairman Dean Cameron, R-Rupert, said, "That's another $40 million we've got to find." Health & Welfare Director Dick Armstrong responded, "Mr. Chairman, that's correct."

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