Medicaid Mischief: A Case Study
Fri May 8, 2009 12:01 pm

In looking into the Medicaid caseload changes afoot in this year's budget process, I was lucky enough to stumble upon a pack-rat who shared with me a clipping of a April 11, 2003 Austin American-Statesman story entitled: Medicaid money may shift.

It's a textbook example of how to manipulate Medicaid to fit your budget agenda:

When the House begins debating its budget bill next week, Republicans will propose an amendment to shift $524 million from Medicaid to public education, House Speaker Tom Craddick said Thursday.The money comes from changing an all-important number: the official projection of how many people will need health care through Medicaid in 2004-5.

Craddick's staff and the Legislative Budget Board lowered the projection, resulting in the extra money that will now go to education.Craddick said that means no programs will be cut and no one will lose services. Because Medicaid is an entitlement program, the state has to give it to qualified applicants. If the new projection is wrong, the state could end up with another Medicaid shortfall down the road. Craddick said the money is being earmarked for education...because a lot of members think education is a higher priority.

Craddick was quite candid in both his method and his intentions. Budget documents show that the Health and Human Services Commission was scheduled to receive $524,473,388 over the previous biennium.  The number apparently caught the eye of Education chair Kent Grusendorf, who thought education deserved that money.  So, Craddick & Co. decided to shift the agency's budget increase to education -- and changed the Medicaid projections to fit their plan.

What's impressive is how accurate the agency's projections proved to be:

In December, 2002, the agency projected a caseload of 2,633,787, for 2004 and 2,857,196 for 2005. (These projections were made for the 2003 session.)

In January, 2005, the supplemental budget adopted by the Legislature showed actual caseloads of 2,659,753 for 2004 and 2,862,298 for 2005.

This week's announcement by Senate that "new" projections would require a $1 billion shift in funds mirrors Craddick's 2003 shift, except the Senate this year hopes to lock in money for Medicaid to avoid a big hit in the supplemental budget next session.

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