Medicaid makes up more than 80 percent of the budget of the state Department of Health & Welfare, the state’s largest agency. This morning, legislative budget writers are holding their budget hearing on Medicaid, the state-federal program that covers health care for disabled and poor Idahoans. For next year, Gov. Butch Otter is requesting a 3 percent increase in state general funds; that’s a 3.7 percent increase in total funds. The federal government pays roughly 70 percent of Idaho’s Medicaid costs, but the feds’ share will drop slightly next year, due to Idaho’s improving economy (it’s dropping from 71.723 percent to 71.368 percent). That will mean an additional $7.1 million cost to Idaho’s general fund to pick up the slightly larger share.

“We are not seeing increases in utilization, which is wonderful news,” Lisa Hettinger, state Medicaid administrator, told the Joint Finance-Appropriations Committee. “What we do see is that we have a caseload increase.” While the number of people on Medicaid went up 6.3 percent this year, the cost per patient has been falling, she said. She attributed some of the savings to a new pilot program for “medical homes” for patients, which has enrolled more than 10,000 people, along with other reforms.

“One of the things that I think is commonly misunderstood and very important to my budget request is exactly who we are serving within the Division of Medicaid,” Hettinger said. “Ninety percent of the people served in Medicaid are children, disabled and the elderly, 90 percent.” Two percent are pregnant women, and 8 percent are healthy adults with children. Non-disabled adults without children currently don’t qualify for Medicaid in Idaho at all. “There are income limits for every category of individuals whom we serve,” Hettinger said, including the disabled and elderly.

The largest population that Medicaid covers, by far, is children – 74 percent – but they are also the lowest cost; highest costs are for seriously disabled and elderly people. “Seventy percent of the dollars that are spent in the Medicaid program are for 30 percent of the individuals," Hettinger said. "So we have some very high payments for a small few.”

As for where the money goes, 96.7 percent of Idaho’s Medicaid budget goes to payments for health care services from providers. Just 3.3 percent goes for administration.