Photo: Courtesy of Mass.gov
BOSTON (State House News Service) — The year-long effort to reassess the eligibility of every single MassHealth member is on track to trim the rolls by 400,000 people by the time it ends this spring, and its director said Thursday the lower caseload should help prevent about $130 million of spending in the largest single bucket of the plan Gov. Maura Healey filed Wednesday.
MassHealth released new data Thursday that show about 133,000 people lost coverage in December, described by Assistant Secretary for MassHealth Mike Levine as a large drop that was expected based on the category of members up for redetermination last month. About 21,000 residents newly joined MassHealth in December, and another 19,000 returned after previously being deemed ineligible, according to the data published on an interactive dashboard.
The net caseload reduction of about 93,000 people in December brings MassHealth's caseload down to around 2.1 million members, compared to the redetermination starting point of 2.4 million members about nine months ago in April 2023 and the pre-pandemic level of about 1.75 million members, Levine said.
"Given where we are, given that we're two-thirds of the way through the process but not two-thirds of the way back towards pre-COVID membership, I take that as kind of confirmation of what we had thought, which is, we're probably not returning to pre-pandemic levels," he said Thursday. "We are going to end this process with more people on the caseload than we had in February of 2020."
Levine said he is "thinking probably between 1.9 and 2 million" for total MassHealth members at the end of the redetermination process this April, but said there's "a ton of uncertainty around that number" and added that he expects membership will tick back up as some people return to MassHealth coverage.
But for fiscal year 2025, Levine said, MassHealth will be "certainly carrying savings related to the redeterminations process."
"Our caseload will be lower on an average monthly basis in FY25 than in FY24. And on a net basis -- in terms of when we think about money out of the General Fund -- we think that's about $130 million net reduction in spending due to lower caseload," he said.
Healey filed a fiscal year 2025 budget proposal Wednesday with MassHealth spending totaling $20.3 billion and representing 35 percent of the budget's line-item spending. That's an increase of $730 million gross over projected fiscal 2024 spending, the administration said. On a net basis, accounting for reimbursements, the administration said the increase would be $440 million.
Administration and Finance Secretary Matthew Gorzkowicz on Wednesday described the MassHealth increase as being roughly 2.5 percent and said there is a lot of work that needs to be done to hold spending growth in a program as large as MassHealth to no more than 2.5 percent in the next budget year.
The administration and the Massachusetts Taxpayers Foundation identified two big challenges facing MassHealth in fiscal 2025. First is that fiscal 2025 will be the first full budget year since 2020 in which Massachusetts gets no pandemic-era federal support for state Medicaid spending, a change that is estimated to cost the budget $820 million in revenue in fiscal 2025. And then there is a projected net increase in non-discretionary spending of $120 million.
"Prior to the implementation of any cost savings initiatives, these two factors would increase net MassHealth spending by approximately $940 million. To restrain net spending growth ... the Healey administration relies on a series of solutions, including the annualization of 9C spending reductions, administrative efforts to strengthen program integrity, and revenue and budget savings generated by reforms to healthcare assessments," MTF wrote Wednesday in its analysis of the governor's budget. "These solutions are offset, in part, by new spending to maintain recent rate increases for primary care services, increase rates for nurses who provide care to patients with complex medical needs, and encourage more eligible individuals to enroll in the Medicare Savings Program."
Levine and Gorzkowicz's office both cautioned that MassHealth's cost per member is increasing a bit while the overall caseload is projected to drop. The Executive Office of Administration and Finance said the "average per-member expense of MassHealth’s members is also expected to increase between FY24 and FY25, as lower-cost members (e.g., non-disabled adults for whom the federal government pays 90% of the cost) leave the caseload."
Levine said the administration did its best in the budget "to account for both the overall scale of change in membership, but much more importantly, kind of who is moving around the caseload" because the cost profile of different members varies greatly.
"By and large, if you go in and click on that dashboard, you'll see it is adults, particularly non-disabled adults between the ages of 21 and 64, where we are seeing by far the greatest reduction in caseload, which is not terribly surprising because those are also disproportionately the people who lost income at the very beginning of the pandemic, came onto MassHealth and then were employed months thereafter, but kept their MassHealth. And when unemployment is 3 percent, a lot of those people are over income" limits, he said, adding that the federal government pays 90 percent of those members' costs. "And so even when a large number of those individuals depart the caseload, when we were only covering 10 cents on the dollar of their health care expense, the reduced spending on the MassHealth side is much more modest."
Written by Colin A. Young/SHNS.
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