Medicaid seeks more funding; hopes to make RCOs reality - Insurance News | InsuranceNewsNet

InsuranceNewsNet — Your Industry. One Source.™

Sign in
  • Subscribe
  • About
  • Advertise
  • Contact
Home Now reading Newswires
Topics
    • Advisor News
    • Annuity Index
    • Annuity News
    • Companies
    • Earnings
    • Fiduciary
    • From the Field: Expert Insights
    • Health/Employee Benefits
    • Insurance & Financial Fraud
    • INN Magazine
    • Insiders Only
    • Life Insurance News
    • Newswires
    • Property and Casualty
    • Regulation News
    • Sponsored Articles
    • Washington Wire
    • Videos
    • ———
    • About
    • Meet our Editorial Staff
    • Advertise
    • Contact
    • Newsletters
  • Exclusives
  • NewsWires
  • Magazine
  • Newsletters
Sign in or register to be an INNsider.
  • AdvisorNews
  • Annuity News
  • Companies
  • Earnings
  • Fiduciary
  • Health/Employee Benefits
  • Insurance & Financial Fraud
  • INN Exclusives
  • INN Magazine
  • Insurtech
  • Life Insurance News
  • Newswires
  • Property and Casualty
  • Regulation News
  • Sponsored Articles
  • Video
  • Washington Wire
  • Life Insurance
  • Annuities
  • Advisor
  • Health/Benefits
  • Property & Casualty
  • Insurtech
  • About
  • Advertise
  • Contact
  • Editorial Staff

Get Social

  • Facebook
  • X
  • LinkedIn
Newswires
Newswires RSS Get our newsletter
Order Prints
January 31, 2017 Newswires
Share
Share
Post
Email

Medicaid seeks more funding; hopes to make RCOs reality

Montgomery Advertiser (AL)

Jan. 30--The good news for legislators: They voted last summer to cover much of the Alabama Medicaid Agency's requested increase for fiscal year 2018.

The bad news: That money is gone in fiscal year 2019.

The uncertainties: All in Washington.

Commissioner Stephanie Azar told budget committee members Monday the agency -- a keystone of the state's health care sector -- will request a total of $869 million in state funding for the next fiscal year, which starts Oct. 1. The increase will, among other items, cover inflation and Medicare Part B services.

"One thing that is not unique to Alabama is that health care costs continue to rise," Azar told the committee.

Legislators -- who will have to weigh Medicaid's request against those of other agencies funded in the General Fund budget -- last summer voted to give $105 million from the state's share of BP settlement over the 2010 Gulf oil spill to the Medicaid program. The agency received $720 million in General Fund money this year, though legislators managed to bring the total funding to $785 million after the special session. Because of the BP money allocated for 2018, the agency will only seek a $44 million increase in General Fund dollars.

But, as Azar and legislators noted, that $105 million will be gone in 2019. The state also faces an Oct. 1 deadline to implement regional care organizations (RCOs) or lose up to $748 million in federal dollars that could be available. At the same time, the state will have to find a way to sustain the RCOs, which aim to move the program from fee-for-service to payment based on outcomes.

"We're going to have to increase revenue or we'll have a serious trainwreck on our hands," Azar said.

Medicaid covers over 1 million Alabamians, more than half under the age of 17. The program also plays a key role in keeping hospitals and doctors' offices open, especially pediatric offices. The numbers are high despite tight restrictions on eligibility. Childless adults almost never qualify, and those with children must make 18 percent of the poverty level -- $3,629 a year for a household of three -- to receive benefits.

State enrollment grew after the Great Recession but has been flat or declining over the last few years. The federal government pays more than two-thirds of the cost of the state program, but the state match has grown as medical costs have climbed.

The RCOs aim to manage cost growth in the program in part by stressing preventive care and establishing health care benchmarks. The state would receive more federal money if it reaches certain goals, such as cutting the state's infant mortality rate. The Legislature approved the RCO program in 2013, but the state delayed implementation amid last year's funding crisis.

The major question for the RCO program is long-term funding. Azar and legislators both appeared to agree that if the state cannot find a sustainable source of revenue, the program should end. Finding new revenue for the perpetually-troubled General Fund budget has been a futile exercise for years: Legislators, for the most part, have been unwilling or unable to create new taxes for the budget, or raise or transfer existing ones.

"So much of the $105 million is one-time money that we have to use in the '18 budget," said Sen. Trip Pitman, R-Montrose, chairman of the Senate Finance and Taxation General Fund committee. "We won't use it in the '19 budget."

The other uncertainties lay in Washington, where Republicans could make major changes to health care laws and funding Alabama relies on. Congressional Republicans have made moves to repeal the Affordable Care Act, which over 166,000 Alabamians had signed up for through the end of December. There has also been talk about turning Medicaid into a block grant program, which could cut the amount of money available to the state.

State lawmakers have voiced uneasiness about that possibility, and Azar said that if Alabama was not at the table in discussions of a block grant program, "things could go very, very wrong." After her presentation, Azar said enrollment was one area of concern, particularly a block grant that may not take catastrophic events into consideration.

"If we have a tornado or something that causes those numbers to go up, we will not get any additional dollars for that increased enrollment," she said. "And then it would be all on our General Fund, which would be very problematic."

House Ways and Means General Fund chairman Steve Clouse, R-Ozark, said he did not expect a serious discussion of new revenue this year, but said there could be discussions later about putting a gambling initiative on the ballot for the state elections in 2018. A committee is also working on proposals to overhaul the state's budget process.

"I would think we're going to have to have a replacement for the whole General Fund," Clouse said.

Monday's meeting was the first budget hearing for state agencies in advance of the 2017 legislative session, which begins Feb. 7.

___

(c)2017 the Montgomery Advertiser (Montgomery, Ala.)

Visit the Montgomery Advertiser (Montgomery, Ala.) at www.montgomeryadvertiser.com

Distributed by Tribune Content Agency, LLC.

Older

The Washington D.C. Economic Partnership – Discussion

Advisor News

  • Help women break through their retirement roadblocks
  • Advisors await SEC decision on Vanguard fair fund distribution
  • What to do when adult children become the client
  • Judge rules insurers not liable for Newport Group’s AME Church pension lawsuit
  • Why vacation homes are becoming a major blind spot for advisors
More Advisor News

Annuity News

  • Legacy Marketing Group partners with Malibu Life USA for annuity launch
  • Best’s Market Segment Report: Global Life/Annuity Reinsurers Remained Poised for Steady Growth
  • When technology becomes easy to rent, what still separates life and annuity carriers?
  • Legacy Marketing Group® and Malibu Life USA Announce Distribution Partnership for New Fixed Indexed Annuity Platform
  • Empower Annuity Insurance Company of America Trademark Application for “EMPOWER WHAT’S NEXT” Filed: Empower Annuity Insurance Company of America
More Annuity News

Health/Employee Benefits News

  • Trump administration cuts health care coverage for some transgender youth in California
  • ‘Downright unaffordable’: State employees in Montana to face higher healthcare costs
  • ACA premiums to rise in Virginia
  • GSP Health plans new Woodward community health center
  • BRAND DRUGMAKERS RAISED PRICES ON 250 DRUGS THIS SUMMER
Sponsor
More Health/Employee Benefits News

Life Insurance News

  • How advisors can get clients to act sooner on life insurance
  • AM Best Affirms Credit Ratings of Crum & Forster Insurance Group’s Members and Monitor Life Insurance Company of New York
  • AM Best Affirms Credit Ratings of Life Insurance Company Centras Life JSC
  • AM Best Withdraws Credit Ratings of New Providence Life Insurance Company
  • When technology becomes easy to rent, what still separates life and annuity carriers?
More Life Insurance News

NEWS INSIDE

  • Companies
  • Earnings
  • Economic News
  • INN Magazine
  • Insurtech News
  • Newswires Feed
  • Regulation News
  • Washington Wire
  • Videos

FEATURED OFFERS

Press Releases

  • Classic Car Insurer OpenRoad Insurance Expands to 40 U.S. States in Two Years
  • How Aspire General Turned an Early Technology Bet Into Claims Automation at Scale with Kyber
  • Adjusto launches AI-Native contents claims services powered by its technology platform
  • URL Insurance Group Celebrates 40 Years of Service, Growth, and Industry Leadership
  • MassMutual Ascend Surpasses $2 Billion in Lifetime Advisory Annuity Sales, Reflecting Continued Momentum in RIA Channel
More Press Releases > Add Your Press Release >

How to Write For InsuranceNewsNet

Find out how you can submit content for publishing on our website.
View Guidelines

Topics

  • Advisor News
  • Annuity Index
  • Annuity News
  • Companies
  • Earnings
  • Fiduciary
  • From the Field: Expert Insights
  • Health/Employee Benefits
  • Insurance & Financial Fraud
  • INN Magazine
  • Insiders Only
  • Life Insurance News
  • Newswires
  • Property and Casualty
  • Regulation News
  • Sponsored Articles
  • Washington Wire
  • Videos
  • ———
  • About
  • Meet our Editorial Staff
  • Advertise
  • Contact
  • Newsletters

Top Sections

  • AdvisorNews
  • Annuity News
  • Health/Employee Benefits News
  • InsuranceNewsNet Magazine
  • Life Insurance News
  • Property and Casualty News
  • Washington Wire

Our Company

  • About
  • Advertise
  • Contact
  • Meet our Editorial Staff
  • Magazine Subscription
  • Write for INN

Sign up for our FREE e-Newsletter!

Get breaking news, exclusive stories, and money- making insights straight into your inbox.

select Newsletter Options
Facebook Linkedin Twitter
© 2026 InsuranceNewsNet.com, Inc. All rights reserved.
  • Terms & Conditions
  • Privacy Policy
  • InsuranceNewsNet Magazine

Sign in with your Insider Pro Account

Not registered? Become an Insider Pro.