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Wednesday, October 23, 2019

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Louisiana Medicaid costs projected to rise by $3.2 billion even as enrollment declines

Louisiana Medicaid costs projected to rise by $3.2 billion even as enrollment declines

Preliminary projections indicate the cost of Louisiana’s Medicaid program could rise more than $3 billion even as enrollment declines.

Chris Keaton, chairman of a legislative subcommittee focused on Medicaid costs, at a recent hearing said about 1.6 million people were in the program during the 2018 fiscal year, when the budget was $11.5 billion.

The Louisiana Department of Health is predicting about 1.5 million people will be in the program in fiscal year 2024, yet the projected budget is $14.7 billion, he said.

“We’re losing 120,000 people in the Medicaid program, but it’s going to cost us an additional $3.2 billion,” Keaton said. “How is that possible?”

Rising health care costs and higher reimbursement rates approved by the legislature this year are part of the answer, health department officials said. They also noted that it was difficult to predict the number of enrollees, given recent policy changes and the new LaMEDS system for checking program eligibility.

“There’s no clear pattern,” said Pam Diez, deputy undersecretary with the department.

She said department staff are working with a team at LSU to dig into the data in hopes of firming up their projections.

The federal government pays most of the costs for Medicaid, a taxpayer-funded health insurance program for low-income patients. Keaton said he's worried that paying for Louisiana’s share of the cost could exhaust all of the available general fund dollars in the state’s revenue projections.

Department Undersecretary Cindy Rives reminded him that LDH has many other sources of financing other than general fund dollars, such as provider fees.

“Eventually, the general fund is going to have to pay for some of it,” Keaton said.

The legislature’s Medicaid Subcommittee of the Health and Social Services Estimating Conference on Wednesday decided not to adopt a Medicaid cost forecast for the ensuing fiscal year, agreeing to meet again later in the year when newer numbers will be available.