State Prepares to Cut Medicaid Spending Due to Budget Stalemate
Citing a state budget that is already 60 days overdue, Department of Administration Secretary Mike Morgan is instructing the Department of Health and Family Services to prepare to reduce monthly appropriations for Medicaid benefits by 20 percent.
"In light of legislative inaction, I am compelled as Secretary of Administration to take action to maintain the integrity of the state's finances until a budget is ultimately adopted," Morgan writes in the letter to DHFS Secretary Kevin Hayden.
Morgan says he has instructed the Division of Executive Budget and Finance to set aside 20 percent of monthly Medicaid appropriations. He asks Hayden to develop an implementation plan and submit it to DOA by Sept. 7.
"I remain hopeful that the Legislature will act to adopt the state budget so that a temporary reduction in Medicaid spending will not have to be implemented," Morgan concludes.
DOA spokeswoman Linda Barth said once the implementation plan is received from DHFS, the agency will evaluate the budget process and decide whether the reductions need to be implemented.
Barth said the secretary will be looking at similar belt tightening in other agencies. "Not having a state budget is really impacting all areas," including Corrections and Transportation, she said.
See the letter here.
