Budget Issues in Health and Human Resources for the 2019 Session - - PowerPoint PPT Presentation

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Budget Issues in Health and Human Resources for the 2019 Session - - PowerPoint PPT Presentation

Jan 22, 2024 354 likes •533 views

Budget Issues in Health and Human Resources for the 2019 Session VML / VACO Finance Forum January 8, 2019 S ENATE F INANCE C OMMITTEE HHR Major Budget Highlights for 2019 Medicaid Expenditure Forecast Impact of Medicaid Expansion

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SLIDE 1

SENATE FINANCE COMMITTEE

VML / VACO Finance Forum January 8, 2019

Budget Issues in Health and Human Resources for the 2019 Session

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SLIDE 2

SENATE FINANCE COMMITTEE 2

  • Medicaid Expenditure Forecast
  • Impact of Medicaid Expansion
  • Medicaid Provider Rates
  • Continued Investment in Community

Behavioral Health Services

  • Addressing Census Pressures at State Mental

Hospitals

HHR Major Budget Highlights for 2019

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SLIDE 3

SENATE FINANCE COMMITTEE 3

Medicaid’s Share of the State Budget Has Grown

K-12 Education 36% Higher Education 19% Medicaid 6% Public Safety 9% All Other 30%

FY 1985

Percent of General Budget by Major Area

Source: Chapter 221, 1986 Acts of Assembly and Chapter 836, 2017 Acts of Assembly.

K-12 Education 30% Higher Education 10% Medicaid 23% Public Safety 9% All Other 28%

FY 2018

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SLIDE 4

SENATE FINANCE COMMITTEE

2018 Medicaid Forecast Reflects Higher Need Than Previously Projected in Last Year’s Forecast

  • New forecast requires additional funding of

$462.5 million GF for 2018 - 20 biennium.

  • Last year, the 2017 Forecast for the 2018-20

Biennium required $576 million GF.

  • Forecast does incorporate Medicaid Expansion

savings, which reduces the growth rate.

  • Base Medicaid spending is projected to increase

by:

4 $5,205 $5,346 $5,346 $202 $260 $447 $4,800 $5,000 $5,200 $5,400 $5,600 $5,800 $6,000 FY 2019 FY 2020 FY 2021

November 2018 Medicaid Forecast

(Dollars in Millions)

Current GF Appropriation GF Need

Fiscal Year 2019 2020 2021 2018 Forecast 6.2% 2.6% 3.5% 2017 Forecast 2.5% 3.4% N/A

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SLIDE 5

SENATE FINANCE COMMITTEE $325 $789 $610 $674 $789 $576 $452 $70 $115

  • $335

$248 $463 $83

  • $85
  • $74

$167 $87

  • $400
  • $200

$0 $200 $400 $600 $800 $1,000 2008-10 2010-12 2012-14 2014-16 2016-18 2018-20

Medicaid GF Forecast Need by Biennium

(Dollars in Millions)

Initial Budget Amended Caboose

Last Increase in an Amended Year of this Magnitude was the 2008 -10 Biennium

5

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SLIDE 6

SENATE FINANCE COMMITTEE 6

Recent Medicaid Expenditure Growth has Averaged Closer to 6% - Projected Growth May Still be Too Low

Note: Expenditures in FY 2011, FY 2012, FY 2015 and FY 2016 have been adjusted to reflect payment shifts between fiscal years in order to better reflect realistic expenditure patterns in the program.

13.5% 5.4% 5.7% 4.6% 3.4% 6.0% 5.7% 6.0% 5.1% 6.2% 2.6% 3.5%

0% 2% 4% 6% 8% 10% 12% 14% 16% FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021

Medicaid Expenditure Growth Rate

Actual Growth Rate Projected Growth Rate

Average ~6%

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SLIDE 7

SENATE FINANCE COMMITTEE

Managed Care Rates:

  • Managed care savings built into the rates for

Commonwealth Coordinated Care (CCC) Plus were not fully realized.

  • Medallion 4.0 managed care rates are slightly higher.

Hospital Fee-For-Service (FFS) Claims:

  • A slower transition of the population from fee-for-

service to the new CCC Plus managed care program results in higher FFS claims. Enrollment:

  • Children’s enrollment higher than projected.

Piedmont and Catawba Hospital Disallowance:

  • $58 million GF for FY 2019.

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2018 Forecast Driven Largely by Managed Care Rates

Managed Care Rates 46% Enrollment 11% Hospital FFS Claims 20% Federal Disallowance 12% Payments from FY 2018 6% Other 5%

Sources of $462.5 million Medicaid GF Need

18% of the GF need is

  • ne-time
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SLIDE 8

SENATE FINANCE COMMITTEE

Last Year’s Forecast New Rate Assumptions 2019 2020 2019 2020 2021 CCC Plus Rates 2.4% 3.5% 5.4% 4.8% 4.3% Medallion 4.0 Rates NC* 3.8% NC* 4.1% 4.2%

Managed Care Rate Assumptions Were T

  • o Low

8 * NC means “No Change” as the rates for Medallion 4.0 are set on a fiscal year basis so the 2019 column reflects FY 2019 for which those rates are in place. CCC Plus rates are set by calendar year and therefore the 2019 rates are not final.

CCC Plus - The newer managed care program for long-term care services, which began August 2017. Medallion 4.0 - The traditional managed care program to cover mostly children and low- income adults.

+3 +1.3

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SLIDE 9

SENATE FINANCE COMMITTEE

Two Major Areas of Uncertainty:

  • Managed Care Rates
  • With limited experience in the CCC Plus program the rates for calendar year 2020 could end up being higher than projected

if actual trends are higher.

  • Woodwork Effect from Medicaid Expansion
  • Outreach efforts will likely result in individuals currently eligible but not enrolled to sign-up for the program.
  • These are traditional enrollees funded at a 50% state match.
  • The 2018 forecast only assumes 1,000 woodwork individuals over the biennium will enroll.
  • In a September 1, 2017 report to the General Assembly, the Department of Medical Assistance

Services estimated 28,000 adults were eligible but not enrolled in Medicaid.

  • 2016 data* from the U.S. Census Bureau indicates as many as 42,000 children are uninsured with

family income at 200 percent or less of the federal poverty level.

Current Medicaid Forecast May Not Adequately Fund All Needs

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* Source: Staff Analysis of Urban Institute Report, March 2018, for the Health Care Foundation. Based on 2016 American Community Survey data.

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SLIDE 10

SENATE FINANCE COMMITTEE 10

Medicaid Expansion Enrollment Projections

  • Enrollment began November 1.
  • The Departments of Medicaid Assistance Services and Social Services have implemented automatic enrollment

for enrollees in the GAP waiver and family planning program. In addition, expedited enrollment has been implemented for SNAP enrollees and parents of low-income Medicaid children.

256 324 364 375 50 100 150 200 250 300 350 400

Thousands

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SENATE FINANCE COMMITTEE 11

Medicaid Expansion Costs and Savings -Virginia

Item ($ in millions) FY 2019 State Costs FY 2020 State Costs FY 2019 Federal FY 2020 Federal Coverage of Newly Eligible Adults $70.5 $276.9 $936.8 $2,983.3 Administrative Costs (DMAS and DSS) 15.7 16.3 40.2 37.1 1115Waiver Administrative Costs (DMAS) 1.7 3.2 1.7 7.2 1115 Waiver Administrative Costs (DSS)

  • 2.2
  • 6.4

T

  • tal Costs

$87.9 $298.6 $978.7 $3,034.0 Indigent Care Savings ($47.5) ($110.3) ($47.5) ($110.3) State-funded Behavioral Health Services (11.1) (25.0)

  • Inpatient Hospital Costs of State Prisoners

(10.3) (23.4)

  • Elimination / Substitution of State-funded

Coverage for Newly Eligible (32.4) (111.0) (33.8) (116.4) T

  • tal Savings

($101.3) ($269.7) ($81.3) ($226.7)

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SLIDE 12

SENATE FINANCE COMMITTEE 12

Children’s Services Act – Private Day Special Education Services

2,971 3,158 3,416 3,585 3,817 4,101 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018

Youth Served

$101 $111 $124 $139 $156 $173 $- $20 $40 $60 $80 $100 $120 $140 $160 $180 $200 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018

Millions

CSA Expenditures for Private Day

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SENATE FINANCE COMMITTEE 13

  • Recent Activities
  • Commission on Youth Studied the issue in 2014 and 2015.
  • In 2016 the State Executive Council had a workgroup to develop options

for consideration by the General Assembly.

  • In 2017 and 2018 the House Appropriations and Senate Finance

Committees have been evaluating the issue.

  • Actions To Date
  • In 2018, a workgroup on private day outcomes completed its work.
  • Rate study of costs is under way with report due in 2019.
  • JLARC may undertake a comprehensive review of Special Education.

CSA – Private Day Placements

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SLIDE 14

SENATE FINANCE COMMITTEE 14

STEP-VA Implementation

STEP-VA Service GA Implementation Date Requirement Funds Allocated Same Day Access July 1, 2019 2017: $6.2M GF / $1.3M NGF (Medicaid); covers 18 of 40 CSBs 2018: $15M GF / $3.2M NGF Primary Care Screening & Monitoring July 1, 2019 2018: $11.1M for FY19 and FY20 Behavioral Health Crisis Services July 1, 2021 2018: $2M in FY20 Outpatient Behavioral Health July 1, 2021 2018: $15M in FY20 Psychiatric Rehabilitation July 1, 2021 – Peer/Family Support Services July 1, 2021 – Veterans Behavioral Health July 1, 2021 – Care Coordination July 1, 2021 – Targeted Case Management (Adults and Children) July 1, 2021 –

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SLIDE 15

SENATE FINANCE COMMITTEE 15

  • Medicaid Expansion Savings
  • $11.1 million in FY19 and $25 million in FY20.
  • Savings impact will vary by CSB – how many current clients will

become Medicaid eligible?

  • Managed Care Payments – Behavioral Health
  • Medicaid managed care payments require billing six different

companies.

  • Billing issues can be disruptive to cash flow.

Community Services Boards Funding

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SLIDE 16

SENATE FINANCE COMMITTEE 16

  • Allows federal funding for foster care prevention services.
  • Governor proposes six positions at the Department of

Social Services for implementation.

  • Focus is on evidenced-based practices, which may require

state assistance to move providers in that direction or to create new services.

  • JLARC Foster Care report may also result in additional

changes for the system (i.e. new requirements, training, staffing standard).

Social Services – Family First Prevention Services Act