La. Medicaid program has budget gap

The Jindal administration is telling legislators an extra $19 million in state dollars is needed to treat the poor this state budget year.

A gap arose in the $7.7 billion Medicaid program, partly because a federal judge ruled the state must pay for what is known as Applied Behavioral Analysis Therapy for qualifying autistic children. Medicaid is the government program that pays for medical services provided to the poor and some elderly and disabled.

The undersecretary of the state Department of Health and Hospitals, Jerry Phillips, said Tuesday he doesn’t expect cutting services will be necessary.

Legislators will be tasked in the upcoming session with filling part of a $154 million hole in the program.

Phillips said the reason for the gap actually is good news.

Unanticipated expenses are to blame, instead of the number of doctor visits, emergency room trips and other more expensive costs missing targets.

“It’s the first time we’ve seen utilization at the amount we’ve budgeted,” Phillips said. “It’s been a good return on what we required.”

Phillips detailed the Medicaid program’s balance sheet in a monthly report to legislators.

Even though the shortfall totals $154 million, legislators are responsible for finding only $19 million.

Part of the gap will be filled by the federal government.

The rest of the money will come from a federal program that captures rebates on prescription drugs given to Medicaid recipients.

“There didn’t seem to be a sense of urgency in the report by DHH. The question is where are we going to find the $18.7 million required for the state match. I can only assume DHH is hoping for excess revenue in the current year,” state Rep. Brett Geymann, R-Lake Charles, said after reading the report.

A couple of problems created the shortfall, including:

  • A federal judge’s ruling that the state must provide Applied Behavioral Analysis Therapy through the Medicaid program.

The therapy helps children with a number of disorders, including autism, learn to listen, imitate and read.

Providing the therapy will cost $30.7 million this state budget year. The state and federal governments will divide the cost.

  • The realization that private insurance companies with Medicaid lines of business will be taxed through the Affordable Care Act. The state will pick up $7.3 million of the tab.

Phillips said the Jindal administration will ask legislators to find the needed dollars in the session that starts in March.

The alternative would be to make cuts in the Medicaid program.

Phillips said the money needed represents maybe a half-percent of the state general fund dollars used for Medicaid.

He said the size of the shortfall should hold unless there is an especially harsh flu season.

“We are encouraged that this would be the amount we’re looking at. It could go up or down ... You feel as confident as you can this time of year,” Phillips said.