Idaho’s Medicaid program is projecting a $42.3 million shortfall in the current year, in state general funds. Last year, the program pushed $89.4 million in bills into the current fiscal year – leaving providers waiting from three weeks to three months for payment – in order to balance next year’s budget. But if that were tried again, state Health & Welfare Director Dick Armstrong told legislative budget writers this morning, the delayed payments would then fall under the reduced federal matching rate 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 JFAC.

Looking ahead, Idaho’s facing a projected state fund shortfall for Medicaid in fiscal year 2012 of $171.6 million. That’s a huge hole, and Armstrong said it’ll likely mean cutting services. Children are protected, so “we would have to focus on adult services – that’s where we’d have to go. We would have to eliminate major categories of service.” Armstrong said “every state in the nation” is looking at the same “Draconian” type of cuts.

One suggestion he offered to cope with the crisis: Back in the ‘50s and ‘60s, there was much more use of volunteers in providing services to the disabled and others. Idaho could “see if there could be a resurgence of voluntary assistance, specifically around keeping adults stable in the home environment,” Armstrong said.