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Governor’s Proposed Medicaid Budget for FY 2022-2023

Kyle Fisher

Despite anticipating a sharp decline in federal funding tied to the end of the public health emergency, Governor Wolf has released a proposed budget for Fiscal Year 2022-23 that maintains existing Medicaid service and eligibility levels.  Alongside proposals to increase the minimum wage and increase funding for public education, the Governor’s budget contains several new Medicaid initiatives intended to protect the Commonwealth’s most vulnerable residents.   

The Governor proposes a general fund budget of $43.7 billion for FY 2022-23.  This would be an increase of $6.2 billion (16.6%) over the current fiscal year budget revised for recommended reductions.  For the Department of Human Services (DHS), the budget proposes a total budget of $53.3 billion, which includes both federal and state funds.  This would be reduction of $923 million (1.7%) from the current fiscal year.

The Medical Assistance appropriation is proposed at $25.1 billion, of which $15.7 billion (62.5%) is federal funds, $5.9 billion (23.5%) is state funds, and $3.5 billion (14%) is provider assessments and other augmentations.  This would be a decrease of 4.2% from the current fiscal year.  Of the overall MA budget, $20.2 billion is allocated for capitation payments to the Medicaid managed care organizations providing physical health ($14.7 billion) and behavioral health ($5.5 billion) services.  The budget assumes an enrollment decline in the upcoming fiscal year of approximately 200,000 individuals due to the end of the public health emergency and the corresponding continuous coverage requirements. 

The Long-Term Living appropriation is proposed at $14.6 billion, of which $7.9 billion (54.1%) is federal funds, $5.6 billion (38.3%) is state funds, and $1.1 billion (7.5%) is provider assessments and other augmentations.  This would be an increase of 5.1% from the current fiscal year.  The Community HealthChoices appropriation ($13.7 billion) comprises the vast majority of the Long-Term Living budget.     
 

Initiatives included in the proposed Human Services and Medicaid budgets include:
 

  • Extension of Maternal Post-Partum Coverage Period – $8 million is provided to extend the post-partum coverage period for new mothers on Medicaid from sixty days to twelve months. 
     
  • Home Visitation & Family Support Program -- $15 million is provided to expand evidence-based home visiting and family support services to 3,800 additional families.
     
  • Expanding County-Level Mental Health Services – $36.6 million is provided to improve the county-based infrastructure for providing MH and drug and alcohol treatment services.
     
  • Expanding Intellectual Disability & Autism Services – $18.8 million is provided to move 832 individuals with ID and autism from the emergency and Consolidated Waiver waitlists.
     
  • Nursing Facility Rate Increases -- $91.25 million ($190.1 million total funds) is provided to increase MA rates for skilled nursing facilities to support increased staffing levels.