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No Medicaid recipients will lose coverage because of a $3.8 million shortfall in the program, but services may become more expensive for some.

Gov. Norm Bangerter announced Monday that surplus state revenues will be used to make up at least half of the Medicaid shortfall. And no services will be cut for at least 30 days while lawmakers decide how to handle a growing Medicaid caseload.Bangerter said Health Department officials will defer changes in the low-income medical assistance program until he meets with lawmakers on interim day Sept. 16.

The governor ruled out most of the proposed cuts that would have reduced services or made people ineligible for the program.

The Medicaid program faces a $3.8 million ($15 million with matching federal funds) shortfall because need for the program surpassed the estimates on which funding was based.

Three cuts are still on the table and Bangerter said he will ask lawmakers to decide whether to implement them:

- About 500 families with children 1 to 5 years old could lose coverage because their parents have gross monthly income or savings above the limit. Families of children older than 6 already have the asset test. This would save the state $185,000.

- People who make too much money to qualify for Medicaid can "spend down" into the program by giving the state the excess income on a monthly basis. Participants would have to pay it for at least four months instead of one to receive medical treatment, saving another $185,000 in state funds.

- The governor said he is not comfortable with a proposal to levy co-payments (which could save up to $1 million), but he wants lawmakers to consider ways to increase "individual participation for services used."

Utah has surplus money to fund the entire shortfall, but that would increase new state funds to $17 million of the program. At that rate of growth, officials would have to come up with $20-25 million in new money for the next fiscal year, Bangerter said.

"I want legislators and others to enter into a dialogue. I want to make sure everyone understands the ramifications on both sides," he said. "The whole thing is still available and using it for Medicaid is not ruled out."

"We're pleased the cuts won't begin tomorrow," said Bill Walsh, Utah Issues director. "We're certainly not out of the woods on Medicaid. Unfortunately, what we need is a systemwide solution. There's no place to painlessly cut in Medicaid."



Total surplus revenues $14.1 million

(Please see microfilm for chart)