2003 Session

Budget Amendments - HB1400 (Conference Report)

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Restore Inflation Adj. for Medicaid HMOs

Item 325 #10c

Item 325 #10c

First Year - FY2003 Second Year - FY2004
Health And Human Resources
Medical Assistance Services, Department of FY2003 $0 FY2004 $16,040,280 GF
FY2003 $0 FY2004 $16,123,907 NGF

Page 310, line 52, strike "$3,463,427,364" and insert "$3,495,591,551".
Page 327, after line 3, insert:
"UUU.1.  Out of this appropriation, $16,040,280 from the general fund and $16,123,907 from nongeneral funds the second year shall be provided to managed care organizations for fiscal year 2004 inflation adjustments.  The inflation adjustment provided to managed care organizations on July 1, 2003, shall be calculated in a manner to ensure that the increase in payments does not exceed the funding provided in this amendment.
2.  Out of the amounts appropriated to managed care organizations, the Department may expend up to $300,000 in fiscal year 2004 for costs associated with developing managed care rates in compliance with federal law and regulation."

(This amendment restores almost 50 percent of the funding to managed care organizations for an inflation adjustment in fiscal year 2004, which was reduced in House Bill 1400, as introduced. The Medicaid forecast had assumed payments to these organizations would grow about 10 percent in fiscal year 2004. This amendment provides an inflation adjustment of approximately 4.7 percent. Language is also added to allow the Department to expend up to $300,000 in fiscal year 2004 for the costs associated with setting rates and contracting with managed care organizations in compliance with federal regulations implementing the Balanced Budget Act of 1997. Federal regulations adopted in 2002 require state Medicaid agencies to provide actuarial certification of the rate setting methodology employed with respect to managed care organizations.)