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Governor’s Proposed Medicaid Budget for FY 2020-2021

Governor Wolf has released a proposed budget for Fiscal Year 2020-21 that maintains existing Medicaid (Medical Assistance) service and eligibility levels.  Alongside proposals to increase the minimum wage, increase funding for public education, and provide universal full-day kindergarten, the Governor’s budget contains a handful of new Medicaid initiatives intended to protect the Commonwealth’s most vulnerable residents.     

The Governor proposes a general fund budget of $36.05 billion for FY 2020-21.  This would be an increase of $1.46 billion (4.22%) over the current fiscal year budget and requested supplementals.  It contains no new broad-based tax increases, and instead relies on anticipated growth in existing tax revenues. 

The Governor’s budget proposes a total budget for the Department of Human Services (DHS) of $40.8 billion, which includes both federal and state funds.  This would be an increase of 3.6% from the current fiscal year.  The DHS appropriation is comprised of $14.4 billion in state general funds, $22.8 billion in federal funds, and $3.6 billion in provider assessments and other augmentations. Of the overall DHS budget, $15.4 billion is allocated for capitation payments to the physical health and behavioral health Medicaid managed care organizations, and $9.1 billion is allocated to capitation payments for the Community HealthChoices (CHC) managed care organizations.  

The Medical Assistance budget assumes enrollment will hold steady in the upcoming fiscal year at an estimated 2.863 million Pennsylvanians.  Of this population, an estimated 759,000 are expected to be adults eligible under the Medicaid expansion category created by the Affordable Care Act.  The enhanced federal match for the expansion population changes from 93% to 90% effective January 1, 2020.  The standard federal match rate is 52.2%.   

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

  • Direct Care Worker Training - $1.2 million is allocated to establish a new training program and credentialing system for direct care workers who serve CHC participants. 

  • Support for Ventilator Dependent Residents – $1.4 million is allocated within the CHC line-item as relief to nursing facilities that serve residents who require ventilator support.  

  • New Parent Home Visitation Program - $1.4 million in new state funds is allocated for the HealthChoices managed care organizations to provide home visiting services to new mothers and newborns.    

  • Lead Remediation - $4.4 million is provided in the CHIP allocation to pursue a CMS Health Service Initiative to expand lead remediation services and increase the number of EPA-certified providers.   

  • Council on Reform Recommendations – $5.1 million is provided to increase staffing in several DHS programs to improve timely facility inspections, investigation of complaints, and implement the recommendations of Governor’s Council on Reform.    

  • Expanding the LIFE Program – $5 million is allocated for the LIFE program to serve an additional 430 consumers dually-eligible for Medicaid and Medicare;   

  • Expanding Intellectual Disability & Autism Services – $15 million is provided to move 732 individuals from the emergency waitlist into the Community Living Waiver and 100 individuals into the Consolidated Waiver.   

  • OPTIONS Program – $8.1 million is allocated to provide services to an additional 1,700 seniors on the OPTIONS in-home services waiting list.