During her first testimony as the Medicaid Director before the Ohio House Finance Committee, Maureen Corcoran stated that the amount allocated to Medicaid in the executive budget met the target growth rate of 3.3% put forth by the Joint Medicaid Oversight Committee (JMOC). Later in the day, at our first Medicaid Institute of the year, the director highlighted the fact that there were no new rate increases for any providers, underscoring earlier testimony that her approach would be “realistic.” With JMOC limiting the director’s appropriation ability, the new policy reality of administrative budgeting means the General Assembly has a much larger role in guiding program growth.How will Ohio approach its #Medicaid budget? Our @LorenAnthes explains here Click To Tweet
With JMOC limiting the director’s appropriation ability, the new policy reality of administrative budgeting means the General Assembly has a much larger role in guiding program growth.
As the director explained in the House Finance Committee, every $1 of state funding generates $5.21 in services. This includes providing services for kids, where, in some counties, Medicaid covers nearly 90 percent of all children under the age of 5. Despite this advantageous fiscal and policy position, however, the political conditions surrounding Medicaid have created a sense of cost cautiousness that places focus on how the administration spends, and not why it is spending what it is spending. To that end, it’s worthwhile to look at an example of how the legislature’s policy choices influence the JMOC target.
Medicaid covers nearly 90 percent of all children under the age of 5.
The independent actuary’s report when JMOC established the rate, guaranteed increased rates for nursing homes, representing nearly $300 million in additional spending. This was done by establishing a nursing facility market basket, which basically sets a baseline for the reimbursement rate of nursing facilities. Translating this to the JMOC target, that is worth about .5% of JMOC target growth. In its budget proposal, the Ohio Department of Medicaid (ODM) eliminated this update which, in part, allowed ODM to meet its JMOC target obligation in law. If the General Assembly wants to reinstate that policy, it will have a few basic choices:
- Exceed the JMOC target by 15% by appropriating an additional $300 million
- Reinstate the market basket by cutting $300 million from somewhere else
- Accept the executive proposal
As the director noted in her testimony, there are more than 135,000 providers that serve Medicaid. This includes physicians, nurses, therapists, social workers, dentists and a whole host of other medical professionals, each with their own role in the delivery system and, often, with their own needs and concerns relative to public policy and Medicaid spending. Currently, none of these providers are receiving an increase in their rates. While a critical component of Ohio’s long term care system, nursing facilities only serve slightly more than 75,000 Ohioans, which is less than 3 percent of the Medicaid population. The General Assembly may determine this is an investment worth making, and perhaps it is. But, as all providers now have to grapple with a zero growth budget, more will be required from the House and Senate in terms of getting the answer to the question, “are taxpayers getting the best deal possible?”