RD105 - Monthly Expenditure Report of the Medicaid Program - March 2007


Executive Summary:
Medicaid expenditures through March are currently 5.3 percent above expenditures through the same period last year. Current funding, based on the November 2006 Official Medicaid forecast and budget amendments enacted during the 2007 General Assembly session, provides for 8.8 percent annual growth, At the fund level, Medicaid general fund expenditures are currently running at 8.5 percent annual growth rate. DMAS' current appropriation provides for 11.5 percent annual general fund growth.

General Medicaid (Acute Care) Services

Expenditures for acute care services are currently running 2.4% more than expenditures at this time last year, but less than the 6.5% increase projected. The slower than projected growth is consistent across all the fee-for-service categories with the most significant factor being larger than expected decreases in pharmacy expenditures associated with the new Medicare Part D program.

Long-Term Care Services

Expenditures for long-term care services are currently 9.8% above expenditures at this time last year. The growth in nursing facility expenditures primarily reflects the annual rate adjustment, as opposed to increases in utilization. The additional 335 MR waiver slots and 65 DD waiver slots funded in the 2006 Appropriation Act and added effective July 1, 2006 are contributing significantly to the growth in home and community-based waiver services.

Mental Health Services

Following the trend seen for the past several years, expenditures for mental health services continue to grow and are currently 15.9% above expenditures at this time last year, however still slightly below the projected increase of 17.3 percent.

Medicaid Recoveries

Prior-year recoveries, including revenues generated from revenue maximization efforts, are currently 33.1 percent higher than recoveries at this time last year. The funding in the current Appropriation Act (Chapter 847) assumes a 28.2 percent increase in prior-year recoveries. The initial reclassification of prior-year pharmacy rebates occurred in March last year; this year's initial reclassification has not occurred yet but is expected to be processed during the month of April and reflected in next month's report.