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

SPONSOR Chasey

ORIGINAL DATE

LAST UPDATED

01/27/08

HB 424

SHORT TITLE Medicaid Waiver Cost-of-Living Increase

SB

ANALYST Geisler

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY08

FY09

$3,100.0

Recurring

General

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplication: SB 268

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Health (DOH)

SUMMARY

Synopsis of Bill

House Bill 424 would appropriate $3.1 million dollars to the Department of Health (DOH) to

fund a cost-of-living increase to providers in the Developmental Disabilities Medicaid Waiver

programs. The funds are targeted at maintaining quality of services, improving staff recruitment

and retention, providing employee health insurance, and salary increases. Any unexpended

funds remaining at the end of fiscal year 2009 would revert to the General Fund.

FISCAL IMPLICATIONS

DOH notes that the funding proposed by this legislation was not included in the executive budget

request.

SIGNIFICANT ISSUES

House Bill 424 seeks to address an on-going issue faced by many developmental disability

providers—the cost of doing business is increasing faster than reimbursements received for

services delivered to a very vulnerable population. DOH notes that the legislature funded

House Bill 424 – Page

2

increased DD Waiver provider rates in FY08 by $2.4 million dollars. DOH believes any new

state funding for the DD Waiver should be directed at serving clients and removing individuals

from the DD Waiver waiting list. DOH requested $2.5 million to increase the number of

individuals on the waiver; the Legislative Finance Committee recommendation included $4

million and the executive did not recommend any expansion funding.

DUPLICATION

House Bill 424 is duplicated by SB 268.

AMENDMENTS

DOH suggests the general nature of the scope of HB 424 would allow provider discretion in the

use of this rate increase. If the intent is to maintain quality of care through staff recruitment and

retention, the following language (beginning on line 22 and ending on line 23): “and meet rising

programmatic and operational cost of quality care" should be deleted.

GG/mt