Even though the budget has yet to be signed into law, the Department of Health and Social Services told legislators today that payments to Medicaid providers will not be interrupted for the remaining weeks of the fiscal year.
Earlier this month, the department quietly announced that it would have to cut off payments to Medicaid providers large and small because it was running out of money. Even though the cut off wouldn’t have directly impacted access to care, the interruption in payments could have put smaller providers in a serious financial pinch.
The operating budget that passed the Legislature this week includes supplemental funding to cover the shortfalls in the current fiscal year, which ends on June 30.
“The department is pleased to confirm that the requested supplemental funding to cover the shortfall is approved. At this time, no payments have been delayed and the department expects to pay all Medicaid claims based on normal processing times with no budget shortfall delays,” explained an email from DHSS Legislative Liaison Tony Newman to legislators this morning.
The shortfall, itself, wasn’t a surprise as the Legislature has made a habit of under-funding the program, but the warning of a cut off came as surprise to providers and legislators alike, who said the administration hadn’t raised red flags about the current fiscal year.
Supplemental funding would typically be passed earlier in the year as its own bill, but it was rolled into the larger operating budget for the upcoming fiscal year. Its passage was delayed as the Legislature wrestled over what to do with a dividend.
“Just one more reason it’s essential that the budget be passed on time,” wrote Rep. Ivy Spohnholz, the Anchorage Democrat who co-chairs the House Health and Social Services Committee, on Twitter. “So pleased that small businesses who provide health care services across Alaska can be assured timely payment for services rendered.”
The budget has yet to go into effect, though, and today’s announcement could turn out to be premature.
The governor has not tipped his hand at what he plans to do with a budget that doesn’t include his signature campaign promise of a $3,000 dividend. In a vague statement, he said anything could be on the table from signing the bill as-is to vetoing the whole thing.
A veto of the entire budget send the supplemental funding for this year—not to mention all the funding for the upcoming fiscal year—back to the Legislature and out of the hands of providers.
On May 28, 2019, the Department of Health and Social Services announced that Medicaid payments during the last three weeks of June would be delayed until the first week of July due to a budget shortfall.
The department is pleased to confirm that the requested supplemental funding to cover the shortfall is approved. At this time, no payments have been delayed and the department expects to pay all Medicaid claims based on normal processing times with no budget shortfall delays.
Tony Newman | Legislative Liaison