INDIANAPOLIS – The state’s April Medicaid expenditure forecast missed the mark by roughly $984 million due to a combination of state budget reversions and unexpected growth of services for aging/disabled Hoosiers, leaving a state agency scrambling for a solution as lawmakers discuss how much to cover from the state’s reserve funds.
Sen. Ryan Mishler of Mishawaka, the key budget architect for the Senate Republicans, cautioned that Indiana’s finances won’t be immediately impacted. But the long-term spending plan for the Family and Social Services Administration (FSSA), which oversees Medicaid, might be.
Mishler said, “Remember this forecast, this is long-term. Currently, we’re in good shape. Fortunately, we have a year before the next budget to work on this.”
Cris Johnston, director of the Office of Management and Budget, noted challenges with getting timely forecasting data for Medicaid claims. She said, “I think part of the long term is changing those practices (and) looking at more timely information.”
The state’s two-year budget, passed by lawmakers in April, relies heavily on forecasted expenses and revenues to make appropriations. However, lawmakers noted that the bill isn’t immediately due and flagged increasing Medicaid costs for future concerns.
Gov. Eric Holcomb said the Medicaid update reveals “there is work to be done.” He continued, “We have begun a deep dive to understand the factors driving the spending increases and what is causing the unanticipated growth.”
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