$90 million deficit The state's Medicaid and QUEST health care programs are running a deficit of about $90 million this fiscal year because of unanticipated increases in recipients and medical costs, according to reports to the Legislature.
hits state Medicaid
A Senate committee approves
emergency funding bills for
the Med-QUEST programsBy Helen Altonn
haltonn@starbulletin.com
The Senate Ways and Means Committee has approved two emergency funding measures to cover the shortfall in this year's $723.3 million Med-QUEST budget.
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Senate Bill 1353, one of the measures going to the Senate floor for consideration, would provide an additional $22.7 million in state general funds for the government health programs.
The second bill, SB 1354, proposes a one-time transfer of nearly $6.3 million in unused tobacco settlement funds earmarked for the State Children's Health Insurance Program to pay for health benefits for Medicaid-eligible children.
The additional state appropriations would draw $61 million in federal funds to help defray the deficit because of federal government matching funds for Medicaid programs.
The Med-QUEST budget request for the next fiscal year is $824.7 million in state and federal funds and $869.1 million in 2004-2005.
In sending the emergency funding bills to the Ways and Means Committee, the Senate Human Services Committee reported that the Med-QUEST budget shortfall is due to a surge of applicants after Sept. 11, 2001, and increased prescription drug costs.
The state Department of Human Services, which administers the Med-QUEST program, does not have enough money to reimburse health care providers for services this year or pay for prescription drugs, the report said.
QUEST generally covers low-income families, while Medicaid assists the elderly, blind and disabled.
Steven Kawada, acting assistant administrator of the Med-QUEST Division, said about 137,000 people are enrolled in QUEST, compared with about 124,000 a year ago. Medicaid enrollment, about 36,000 recipients, generally is stable, he said.
The state's economic slump probably spurred increased QUEST enrollment, which generally covers low-income working people, Kawada said. Increased utilization and rising medical expenses were big factors leading to the deficit, he said.
Prescription drug costs are increasing at a rate of 16 percent a year, according to the report. Med-QUEST prescription drug costs are expected to exceed $99 million this year, while the budgeted amount was nearly $87 million.
The Hawaii Primary Care Association and other organizations concerned about medically uninsured children protested taking money from the tobacco fund to help cover the Med-QUEST deficit, which SB 1354 would do. Although it is supposed to be a one-time solution, it could set a precedent, said Beth Giesting, the association's executive director.
"We are well aware of the difficult fiscal balancing act you and the administration must perform," she testified. "However, we do not endorse diverting money that is expressly intended to expand children's coverage to instead pay for core services for the existing Medicaid-QUEST population, whether children or not."
The State Children's Health Insurance Program targets children of families with incomes up to 300 percent of federal poverty level who are not eligible for Medicaid-QUEST, she pointed out.
She said the tobacco funds should not be used to cover Medicaid benefits for kids "to whom the Department of Human Services already has an obligation."
