Dunleavy budget includes $225 million cut to Alaska’s state share of Medicaid
In his fiscal year 2020 budget released Wednesday morning, Dunleavy is proposing to reduce the state's portion of Medicaid funding, which is expected to be
Dunleavy has pledged to eliminate the state's
"This budget is going to impact all Alaskans; it's too big not to," Dunleavy said during a news conference to announce his budget plan.
Dunleavy has repeatedly said he wants to reduce state spending on Medicaid to a sustainable level.
As of October, 210,276 Alaskans were enrolled in Medicaid or the
Barnhill emphasized that the administration is not proposing to eliminate coverage for anyone currently enrolled in the state's Medicaid program. Instead, it's working with the federal
"
State budget director
However, state Medicaid funds are tied to large sums of federal money.
The federal government covers at least 50 percent of the costs generated by each Medicaid enrollee. Costs from traditional Medicaid recipients are covered 50-50 by the state and the federal government, while Medicaid expansion recipients are covered 93 percent by the federal government and 7 percent by the state this year.
The Medicaid expansion cost share will shift to 90 percent federal and 10 percent state for 2020 and beyond.
Alaska Native Medicaid claims are paid 100 percent by the federal
According to the Legislative Finance Division, overall spending on Medicaid in
Those state savings have largely been attributed to shifting state costs to the federal government through Medicaid expansion and the Medicaid reform package the Legislature passed in 2016 with broad bipartisan support.
Arduin said it's unclear at this point exactly how much federal money the state would forgo with a roughly
The overall DHSS budget would be cut by
Hultberg was a former commissioner of the
Pulling that much money out of
While the proposed cuts may improve the state's bottom line, they would be extremely damaging to hospitals, particularly rural hospitals, if they are implemented through provider reimbursement rate reductions, according to Hultberg.
"We had several small hospitals with less than 10 days' cash on hand last year. They cannot sustain significant provider cuts without closing their doors," she said.
A study released Monday and commissioned by the Hospital and
That study looked specifically at Medicaid expansion funding, which many political observers thought Dunleavy would attempt to repeal.
The state reduced Medicaid payment rates for professional services and hospitals by 5 percent to 8 percent in 2017. Further drastic reductions to provider payment rates would also result in fewer physicians and health care facilities accepting Medicaid patients, Hultberg added.
"I think there's either a lack of understanding of reality (by the Dunleavy administration) or a willingness just to make
Alaska Primary Care Association Policy Director
A spokesman for DHSS referred a request to interview Crum on potential Medicaid policy changes to a phone line in OMB dedicated to press inquiries about the budget. The phone line was unattended.
Zasada noted that Medicaid reimbursement rates for the federally qualified health care centers the APCA represents are calculated differently than rates for hospitals or private practice physicians; however, those rates have been frozen for four years, he added.
APCA officials are also concerned about a prospective
Critics of
"To give you an order of magnitude, all of the services on the optional services list, which includes behavioral health, pharmacy, emergency department services, are about
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