On Tuesday, November 15, the Joint Medicaid Oversight Committee (JMOC) heard from its contracted actuary Optumas about the target growth rate for Ohio’s Medicaid program. For a refresher on what that entails, take a look at this blog from a couple of years ago.
The major areas driving cost in the program come from the long-term care population and pharmacy – not the Medicaid expansion population.
To explain simply, this is a process wherein JMOC establishes an overall target for growth in spending based on the population mix, and projected consumer price index for the Ohio Department of Medicaid so the department can create its budget request to the General Assembly. Notably, this will be the first time a target is set for someone other than Governor John Kasich, so it remains to be seen how Governor-elect Mike DeWine’s administration will work with this target in the development of its first Medicaid budget request. What are the major factors driving Medicaid costs? Find out what the state determined here Click To Tweet
The actuary’s report did not include a break-out of the Medicaid expansion population in its estimates – an appropriate deviation from previous practice. When asked, JMOC Director Susan Ackerman noted this was due to the fact that the population, from a cost perspective, was the same as adults in the covered families and children group and therefore did not need any special policy focus. While there is a pending waiver that would restrict access to this population, and the expansion population has a deflationary impact on the growth target, it is not as significant a population in terms of overall Medicaid spending.
this will be the first time a target is set for someone other than Governor John Kasich
As the actuary and the director demonstrated in the presentation, the major areas driving cost in the program come from the long-term care population and pharmacy – not expansion. In fact, the actuary highlighted the fact that nursing homes in particular (the only provider group to have rates protected in law) will see an automatic rate increase worth $300 million over the next two years. When asked, the actuary confirmed this practice is rare in state Medicaid programs.
While oversight of Medicaid expansion has been a popular political project of the General Assembly, the most impactful policy work in controlling costs comes from reforming long-term care, addressing price and developing strategies around the social determinants of health. For background, check out our suggested reforms to long-term care, pharmacy and social determinants (including housing, education, food insecurity and transportation).