Chairman Nelson convened the Health and Human Services Committee for a briefing on Medicaid utilization and the executive budget’s assumptions, focusing on developmental disabilities, long-term care and medical services.

The department told the committee that utilization trend lines are generally flat or rising and that timing of claims — not underlying demand — explains many of the spikes on the department’s graphs. "Providers on average bill us approximately around 45 days after the date of service," said Sarah Aker, executive director of the Division of Medical Services. Aker also said the department’s "average time frame for payment of all claims is 7 days." Those lags and catch-up billings shaped the committee’s view of the budgeted unit counts and cash outlays.

The presentation stressed two budget risks: one administrative and timing-related, and one programmatic. On timing, the committee heard that a national billing vendor outage (Change Healthcare) suppressed submitted claims for several months and produced later spikes when providers resumed filing. On programmatic risk, staff highlighted 1915(i) — a home- and community-based service option for people with behavioral-health needs — as an area with rapid recent enrollment growth and uncertain near-term costs. "The 7,000,000 that we have budgeted for this area for next biennium is actually a decrease from what was budgeted in the current biennium," Aker said, while noting enrollment had risen from about 200 to over 800 people in recent months.

Committee members pressed staff on how units translate into people served. Staff repeatedly warned that a unit is a billing measure — for some services a single day, for others a 15-minute increment or an encounter — and does not directly equal one person. For waiver programs and long-term care, staff said units include a mix of personal care, homemaker, therapeutic and equipment services; those combinations make headcounts difficult to infer from unit totals.

Members asked about eligibility and caps. Aker explained the 1915(i) eligibility rules include financial limits, and that some families may be ineligible for 1915(i) despite qualifying for other waiver programs. For one children’s waiver, staff said there is a per-family annual cap for some services: "There a $23,500 cap that all" families would face under that waiver, Aker said. The committee also heard that provider enrollment and outreach have been stepped up, including a live call line and contractor performance requirements, because many potential providers are nontraditional (for example, community organizations or faith-based groups) and need extra assistance to enroll and bill.

On larger program-level numbers, staff said the state is seeing fewer overall Medicaid eligibles after the federal eligibility unwinding: approximately 130,000 covered in the prior biennium versus about 107,000 now, which reduces projected utilization for certain fee-for-service buckets. Staff also noted that some decision-package dollars requested by the governor — specifically a $68,000,000 package for home- and community-based services — were not incorporated into the charts shown to the committee.

Several committee members asked for additional analysis. Representative Murphy asked for closer monitoring of early 2025 claims to determine whether utilization trends will climb and require budget adjustments; staff agreed there is risk and described ongoing reviews. The committee also asked staff to prepare comparable utilization visuals for the Medicaid expansion (MCO/encounter) population in the same format as the fee-for-service graphs, which staff said they could provide but cautioned that data-extraction formulas may differ.

Staff summarized provider-billing rules and timing: providers may file timely claims up to 180 days after service; in practice many file around 45 days. The department emphasized it reports paid-date cash flows because those figures correspond to actual appropriations and cash outlays.

On other program notes, the committee heard that PACE enrollment is small but growing (staff reported enrollment of 190 individuals as of Dec. 31) and that dental providers were especially affected by the Change Healthcare disruption, with continued paper submissions in some areas. The presentation also noted that children’s hospice waiver enrollment is typically near zero and that the autism waiver has expanded slots but much of that population uses state-plan services such as applied behavior analysis.

The briefing closed with staff reiterating that the department will return to the committee with updated runs and more recent actuals as claims continue to be processed.