Director outlines Idaho’s gloomy Medicaid outlook

BOISE – Idaho’s Medicaid program is facing such a big potential shortfall next year that officials are considering using volunteers to help those who now rely on its services.

State Health and Welfare Director Dick Armstrong told state lawmakers Tuesday that back in the 1950s and 1960s, volunteers performed many services that Medicaid provides today, such as driving disabled people to doctor’s appointments and checking on whether mentally ill patients have taken their medication.

Idaho, he said, could “see if there could be a resurgence of voluntary assistance specifically around keeping adults stable in the home environment.”

His suggestion came after he told legislative budget writers that Idaho’s Medicaid program could be short a projected $171.6 million in the fiscal year that starts in July.

“We would have to eliminate major categories of service,” Armstrong said.

Sen. Joyce Broadsword, R-Sagle, vice chairwoman of the Senate Health and Welfare Committee, said Armstrong was onto something with tapping volunteers. “I think it’s a good idea,” she said. “That’s part of helping our community as a whole. If we don’t all pull together, we have less opportunity to come out of this as a healthy state.”Armstrong is projecting a $42.3 million shortfall for Medicaid, the joint federal-state program that provides health coverage for the poor and disabled, in state general funds in the current year. He’s proposing filling most of that hole with a one-time draw on the state’s tobacco-settlement fund, but the next year, the budget hole would grow to several times that.

The projected shortfall – caused by a drop in the federal match for Medicaid as the economic stimulus funding ends, along with growing caseloads – would likely mean cutting services.

Children are protected, Armstrong said, so “we would have to focus on adult services.” He said every state is looking at the same “draconian” type of cuts.

In Washington, for example, officials are examining eliminating all coverage for pharmaceuticals for adults. “That’s terrible health care policy,” Armstrong said, and would just drive up hospital costs.

Idaho provides some services that are considered optional under federal law, including prescription drug coverage and services for the developmentally disabled. Also considered optional: hospice care, dentures, eyeglasses, preventive care, mental health treatment and prosthetics, among others. But Armstrong said he doesn’t know what could be cut from that list. For now, he’s submitted a budget request to have the full shortfall covered by the state – but he said he has little hope that can happen given the grim budget outlook.

Last year, Idaho pushed $89.4 million in Medicaid bills into the current fiscal year – leaving providers waiting up to three months for payment. But if that were tried again, Armstrong said Tuesday, the delayed payments would then fall under the reduced federal matching rate for Medicaid that Idaho will see next year.

“That doesn’t mean it might not be a good strategy, but it has a significant cost attached to it that we didn’t face last year,” he told the Legislature’s joint budget committee, which wrapped up two days of hearings Tuesday on the state’s budget challenges.

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