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F I S C A L I M P A C T R E P O R T

SPONSOR Jennings

ORIGINAL DATE

LAST UPDATED

02/05/06

HB

SHORT TITLE

MEDICAID ELIGIBILITY FOR CERTAIN

ADULTS

SB 543

ANALYST Weber

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

$22,500.0

Recurring

General

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates HB 648

Relates to Appropriation in the General Appropriation Act

REVENUE (dollars in thousands)

Estimated Revenue

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

FY08

$57,500.0

$57,500.0 Recurring

Federal

Medicaid

(Parenthesis ( ) Indicate Expenditure Decreases)

ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT (dollars in thousands)

FY06

FY07

FY08 3 Year

Total Cost

Recurring

or Non-Rec

Fund

Affected

Total

$41,000.0 $41,000.0 $82,000.0 Recurring General

(Parenthesis ( ) Indicate Expenditure Decreases

SOURCES OF INFORMATION

LFC Files

Responses Received From

Human Services Department (HSD)

Senate Bill 543 – Page 2

SUMMARY

Synopsis of Bill

Senate Bill 543 appropriates $22.5 million from the general fund to the Human Services

Department for the purpose of financing the Medicaid program for expanded eligibility criteria.

Medicaid eligibility is expanded to include adults in benefit groups with income up to and

including 100 percent of Federal Poverty Level (FPL).

FISCAL IMPLICATIONS

The appropriation of $22.5 million contained in this bill is a recurring expense to the general

fund. Any unexpended or unencumbered balance remaining at the end of FY07 shall revert to the

general fund.

SIGNIFICANT ISSUES

Medicaid currently covers adults in benefit groups with gross income up to and including 85% of

FPL provided that the adult(s) have less than the current standard of need after income

deductions and exclusions. HSD estimates there are that approximately 38,500 adults under

100% FPL with at least one child and not currently covered by Medicaid. An adult must have at

least one dependent child in order to be categorically eligible. If all were covered, and assuming

the per member per month rate is $450, the cost would be $207 million per year total requiring

$58.8 million from the general fund. Based upon a take-up rate of 70%, the costs would then be

$144.9 million total and $41 million from the general fund. The appropriation in this bill of

$22.5 million would generate an additional $57.5 million in federal Medicaid match. This would

leave an unfunded requirement of about $18.5 million annually from the general fund.

Without an appropriation consistent with the increased costs it must be anticipated service or

eligibility reduction in other Medicaid areas would be required.

TECHNICAL ISSUES

The bill does not specify whether or not income disregards and exclusions would apply or if a

standard of need would still apply.

MW/mt