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DHS asking for additional $82.8 million from state general fund

DES MOINES - Members of the Department of Human Services are asking for an additional $82 million for FY2020, and a big chunk of that money would go to cover increased costs associated with the privatized Medicaid program.

Local 5 On Your Side looked through the documents submitted by the Legislative Services Agency on October 10. According to the request, DHS wants an additional $82.8 million, and that money must be taken from the general fund. The Department of Management has until November 15 to adjust any final budget records or department requests.

A majority of the request is to cover Medicaid costs. Here's the itemized list, consisting of $69.2 million additional funding:

• An increase of $9.4 million to replace carryforward and lower revenues from various funds.

• An increase of $64.3 million to replace the unfunded need from FY 2019.

• An increase of $20.3 million for a one percent increase in member months paid to managed care organizations (MCOs).

• An increase of $12.7 million for increased fee-for-service claims, Medicare Part A and B premium payments, and the Medicare Part D Clawback payment.

• A decrease of $7.6 million due to an increase in drug rebates and other recoveries.

• An increase of $5.2 million for increased funding related to HF 2456 (FY 2019 Mental Health Services Needs Act).

• An increase of $1.3 million due to drug costs associated with Hepatitis-C criteria changes.

• A net decrease of $36.2 million to reflect the increase in the regular Federal Medical Assistance Percentage (FMAP) rate. That increase is offset by a decrease from 93.5% to 91.5% in the Iowa Health and Wellness Plan FMAP rate.

• A decrease to $195,000 to reflect the Governor’s FY 2018 veto of a Durable Medical Equipment Pilot Program.

• This request does not reflect any increase in MCO capitation rates for FY 2020.

DHS also asked an increase of $1.2 million for Medical Contracts to replace lower than expected available revenues from the Pharmaceutical Settlement Account. DHS leaders also requested an extra $12 million for the Children's Health Insurance Program.

Read a full copy of the request here.


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