| FY 2010-11 Year-to-Date Gross Appropriation |
$14,124,104,600
|
| Changes from FY 2010-11 Year-to-Date: |
|
| 1. Impact of the Expiration of the American Recovery and Reinvestment Act (ARRA) Federal Medical Assistance Percentage (FMAP) Provisions. Enhanced Medicaid FMAP, implemented under ARRA, will expire on June 30, 2011, and reflected a significant increase of $585.2 million in GF/GP costs due to this expiration. |
0
|
| 2. Expiration of One-Time Retroactive FMAP Adjustment. Governor added $160.0 million GF/GP to reverse a one-time retroactive FMAP adjustment that corrected for the way pension payments by General Motors affected the State's FMAP. |
0
|
| 3. Increase in Base FMAP Rate. The base Medicaid FMAP will increase from 65.79% in FY 2010-11 to 66.14% in FY 2011-12, leading to a savings of $29.9 million GF/GP. |
0
|
| 4. Medicaid Base Funding. Governor included base adjustments for Medicaid, Community Mental Health (CMH) Medicaid services, the Children's Special Health Care Services (CSHCS) program, and the Adult Benefits Waiver, increasing GF/GP costs by $160.2 million. Also included no actuarial soundness adjustment for Pre-paid Inpatient Health Plans (PIHPs) and Medicaid Health Maintenance Organizations (HMOs). |
453,053,400
|
| 5. Transfer of Responsibility for Forensic Mental Health Services to Corrections. The funding and staff for forensic mental health services would be transferred to the Department of Corrections, which previously paid for these services via an IDG. |
(50,527,800)
|
| 6. Cost Reduction Measures. Governor included numerous cost reduction measures: Savings from a shift to mandatory managed care for CSHCS Medicaid clients, savings from a proposed waiver to implement managed care for "dual eligibles", a 40.0% reduction in Medicaid graduate medical education payments, a 3.0% reduction to CMH non-Medicaid services, administrative reductions to substance abuse services, a 5.0% reduction to local public health, a 9.0% reduction to many Aging programs, $1.0 million in reductions to Healthy Michigan Fund programs, eligibility limits for the Adult Home Help program, and 15.0% reductions to many legislative initiated programs. Savings also were assumed from proposed legislation: a requirement that auto insurers provide information to aid in third party liability recoveries, the inclusion of behavioral health drugs on the Medicaid preferred drug list, and proposed enhancements to the Medicaid estate recovery program. Total GF/GP savings from these measures was assumed to be $78.2 million. |
(186,709,900)
|
| 7. Replacement of PIHP and HMO Use Tax with 1% Tax on Paid Health Claims. Governor reflected a Gross and GF/GP savings due to the proposed elimination of the 6% PIHP and HMO Use Tax. Due to actuarial soundness requirements, the State effectively reimbursed the PIHPs and HMOs for the cost of the $388.4 million tax via increased Medicaid payments. Eliminating the tax removes the need for these payments and would save the State $131.5 million GF/GP. Governor proposed replacing the Use Tax with a 1% tax on all paid health claims, which would raise an estimated $396.9 million in Restricted revenue, which would be used to offset GF/GP in the Medicaid program. |
(388,352,900)
|
| 8. Economic Adjustments. Total GF/GP costs of these adjustments were $10,293,500. |
22,464,200
|
| 9. Other Changes. Other changes resulted in a minor decrease in funding. |
(8,722,600)
|
| Total Changes |
($158,795,600)
|
| FY 2011-12 Governor's Recommendation |
$13,965,309,000 |