Meridian legislators warn about Medicaid costs

It’s only been a month since the Idaho Legislature adjourned sine die, but Meridian legislators are already looking forward to next year, particularly with respect to Medicaid expansion.

A number of West Ada legislators – all Republican, because Meridian has only Republican legislators – appeared on May 21 at a panel convened by the Meridian Chamber of Commerce.

Following a successful citizen-led initiative, the Legislature complied with a commitment Gov. Brad Little made during his State of the State speech to fund expansion of Medicaid to low-income working people. In the process, they added a variety of “sideboards” to the program, such as work requirements.

Several of these require approval of waivers by the federal Centers for Medicare and Medicaid Services (CMS), and the Legislature is waiting to hear about those. Rep. John Vander Woude said he expects to hear in about three months, with details to be settled by the beginning of the legislative session in January. Several requirements Idaho added have been approved for other states, so he is sanguine, he said.

However, Vander Woude and other legislators expressed unease about what the program will eventually cost. The budget for the Idaho Department of Health & Welfare has almost doubled in the time that he has been in the Legislature to $3.7 billion, he said, partly because more people keep signing up for Medicaid. Medicaid expansion was originally expected to apply to about 60,000 people, then 90,000, and he said he wouldn’t be surprised to see it hit 100,000.

“I still think Medicaid expansion could be the budget-buster for the state,” Vander Woude said.

While much of the cost for Medicaid expansion is expected to be covered by the federal government, that’s not guaranteed, legislators said. Medicaid expansion is currently funded 90% by the federal government and 10% by state government, but standard Medicaid is covered by the Federal Medical Assistance Percentages (FMAP) at a 70%-30% split.

But occasionally those percentages change, and every FMAP percentage point costs another $20 million, Vander Woude said. Moreover, Sen. C. Scott Grow said he was concerned Medicaid expansion would also revert to the 70%-30% rate.

In addition, Rep. Mike Moyle pointed out that the Idaho Legislature had funded only six months of Medicaid expansion, and that it wasn’t clear where funding would come from for the rest.

Other major business issues covered during the discussion included transportation funding, a Chamber priority. Legislators pointed out that they had approved $90 million for the expansion of Highway 20/26 and funding for Highway 16, both in the Meridian area.

Some other items typically funded out of the transportation budget, such as the Idaho State Police, have been removed from that budget and paid for instead out of the general fund, which also pays for items such as education and human services. Fuel-efficient cars and cars that don’t use gasoline are making the current funding mechanism – based on the fuel tax and registration fees – untenable, legislators said.

Instead, the Legislature is considering options such as “ton-mile” taxes, where commercial vehicles would be assessed a fee based on their weight and the distance traveled, said Rep. Jason Monks. However, such taxes – and anything else assessed against commercial vehicles – would likely come back to consumers in the form of higher prices, he warned. Ultimately, he thinks it’s likely that transportation will start taking more money out of the general fund, he said.

Hemp was also not legalized by the Idaho Legislature this year, although the federal government has legalized it and Idaho is one of just two states that, for now, don’t allow it. (Nebraska, the other, is still considering it.) Vander Woude said it would likely be considered next year. Moyle noted the House passed it twice and blamed the Senate that the bill didn’t pass, adding that hemp dryers that could have been built in Idaho were instead being built in Ontario, Oregon.