Democratic legislators scrutinize $20 million Medicaid ‘cushion’Medicaid expansion is the top legislative priority this year for Democrats.
By: Bob Mercer, Republic Capitol Bureau
PIERRE — The department head said Tuesday that a $20 million cushion for Medicaid in the state Department of Social Services allows for better budget estimates.
But a Democratic legislator’s questions didn’t generate a detailed explanation of how the extra money made a difference.
In fact, all three Democrats on the Legislature’s Joint Committee on Appropriations sounded skeptical at various times about the projections, revisions and explanations regarding the Medicaid budget that Social Services Secretary Kim Malsam-Rysdon provided.
Medicaid expansion is the top legislative priority this year for Democrats, who are in the minority in each of the Senate and the House of Representatives.
Republican Gov. Dennis Daugaard, on the other hand, said it’s too soon to commit without more assurances from the federal government about the long-term availability of funding.
During the appropriations hearing Tuesday on the Social Services budget, Rep. Susan Wismer focused on the $20 million carryover in Medicaid funding which the Legislature allowed last session.
Malsam-Rysdon said the availability of the funds helped fine-tune and provide a conservative estimate on the eligible people and their uses of services.
“Nobody wants to have another discussion between appropriators and the Department of Social Services when there isn’t enough money to fund the services we have to fund through Medicaid,” Malsam-Rysdon said.
She said Social Services needed to ask for a supplement in 2004.
The department doesn’t expect to use the $20 million in 2014 but would like to keep the funds in reserve, Malsam-Rysdon said.]
Wismer, D-Britton, asked whether any assumptions were changed by Social Services officials in budgeting for 2014 because of the availability of the $20 million.
Malsam-Rysdon said the department revised its 2013 estimate down as a result. She said the $20 million “gives security” but she declined to say how the estimate would have changed if the $20 million cushion wasn’t present.
The monthly averages of children and adults receiving Medicaid and Children’s Health Insurance Program services have increased every year since at least 2008. The current 2013 budget year — which runs from July 1, 2012, through June 30 — has seen the first break in that trend.
Social Services’ latest forecast calls for CHIP recipients to increase by 502 to a monthly average of 13,509, while children receiving Medicaid would decline by 442 to a monthly average of 65,908. Adults receiving Medicaid would climb by 745 to a monthly average of 37,119.
All told, the three categories combine for only a 0.70 percent increase, much smaller than Social Services estimated a year ago. Consequently the department plans to ask the Legislature to reduce its current medical-services spending authority about $6 million of state funds and about $7.8 million of federal funds.
From 2008 through 2012, the actual percentage increases were 2.10, 6.20, 3.06 and 1.16. With the current year now forecast at 0.70 percent, while South Dakota has had one of the largest increases in per capita income in the nation post-recession.
The department expects the 2014 monthly averages to go up across the board: Children on CHIP to climb to 13,856, children on Medicaid to go up to 66,850 and adults on Medicaid to rise to 38,040.
Overall, those would total an increase of 1.90 percent over the current revised numbers for 2013.
For the 2014 budget, which starts July 1, 2013, the department is asking for about $11.1 million more for inflation adjustments to its many providers of Medicaid and other services and for about $2.4 million specifically to cover more Medicaid-eligible adults and children and their increasing uses of Medicaid services.
Democrats on the appropriations committee are wondering what to believe.
Malsom-Rysdon defended the 1.9 percent projection for 2014. “When we go up, and we come back down, we eventually go back up,” she said.