Day 1 of the Health and Care Budget Hearing: Medicaid and Child Care Costs and Federal Funds

The Idaho Department of Health and Welfare makes up about a third of the state’s total budget each year.

That’s because — as Director Dave Jepsen explained in a hearing Tuesday — the department serves an enormous cross-section of the Idaho population, through a host of different programs.

Jepsen and other state health and welfare officials answered questions from the Joint Appropriations Committee on Tuesday, during the first session of a multi-day hearing on the budget.

Idaho lawmakers have focused on the large and growing costs of health insurance and Medicaid child care programs, and have asked questions about how much the state has spent on hospitalizations, drugs and other programs in recent fiscal years.

“I first want to just say that my heart is cold. But I feel like our responsibility here is to make sure the money is well spent, so that taxpayers can of keeping that money and raising their children. So with that in mind, I don’t have a cold heart but I do have a few questions.”

Cook and the rest of the JFAC had so many questions that the department’s presentation ran against its allotted time And it continues Wednesday.

Questions about federal funding for health and welfare in Idaho

The 2022 election brought more far-right lawmakers into the Idaho House and Senate, and a few of those lawmakers have asked questions that suggest they want to further limit Medicaid spending and roll back federally funded expenditures.

The bulk of the department’s spending is a pass-through of federal government money, as opposed to Idaho’s own money. This is especially true of the voter-approved Medicaid expansion, which allowed working adults and the poor to obtain health insurance through Medicaid, at a reduced cost to Idaho taxpayers.

“I’m wondering,[with]our childcare programs… are we using all the federal money?” asked Sen. Scott Herndon, R-Sagle. “Is It Possible to Run Child Care Programs Entirely with State versus Federal Money?”

Jill Randolph, a budget and policy analyst at Health and Welfare, told Herndon she couldn’t say right away if state money could only be used for childcare programs. But her presentation to the committee showed that in the past few years, about 63% of the budget for those programs relied on federal funds.

What does the Idaho Health and Care Plan do with a $5.5 billion budget?

Among its responsibilities, the Idaho Department of Health and Welfare and its divisions and offices are:

  • Administration of health insurance benefits for More than 434,000 children and adults in Idaho through Medicaid and Children’s Health Insurance Program, or CHIP
  • Operation of state child protection and custody systems
  • Inspect healthcare facilities to ensure they are operating safely and meeting all federal requirements
  • and directing a variety of other programs such as help paying for child care, residential treatment facilities for children, state psychiatric hospitals, adult behavioral health care, food stamps, temporary cash payments to low-income families, suicide prevention, public health and more.

The budget covers staffing costs to run these programs and pay for services within them.

The Medicaid budget request of $4.7 billion is about 16% higher than the fiscal year 2023 appropriation, which was about 6% higher than the fiscal year 2022 appropriation.

Rep. Rod Furness, Rigby, noted the high cost of Medicare for people enrolled in Idaho Medicaid.

Rep. Rod Furness, R-Rigby, asked state health and welfare officials about medical spending in his 2024 fiscal budget request. (Screenshot via Idaho In Session)

In its presentation, the department showed that prescription drugs are Medicaid’s largest expense. Jepsen said this was due to higher prices for “specialty medicines” and cancer treatments.

“You may remember that just two years ago, a cure for hepatitis C was developed. The amazing thing is that it’s a cure — hepatitis C can go away permanently,” he said. That was $300,000 per person for this drug. And so, you get these kinds of specialty drugs that are really high-priced miracle drugs.”

Jepsen described a new drug treatment that “actually cures blindness in some people, so here’s the miracle: You can make a person see again.”

Only a small number of Idaho residents could benefit from the drug — but it costs about $2 million a dose, he said.

“It’s oncology, cancer drugs, and specialty drugs that drive up costs,” Jepsen said. And the question remains open for us, how do we continue to best manage that. We’ve had conversations with colleagues in Medicaid programs across the country. They all face the same problem.”

Leave a Comment