Senate passes Medicaid reserve fund bill

CHARLESTON, W.Va. — The state Senate quickly considered and passed Gov. Jim Justice’s proposal to take $150 million out of current Medicaid funds to create a trust fund.

Senate Bill 633 passed overwhelmingly, 33-0 with one absence. Senators also suspended constitutional rules requiring bills to be considered on three separate days to quickly dispense with the bill Tuesday.

The bill now goes to the House of Delegates for consideration.

But some senators asked if there aren’t immediate needs for that money.

Ron Stollings

Senator Ron Stollings, D-Boone, asked — as he has for weeks — whether the bill does anything to increase the reimbursement rates to medical providers for government insurance. The bill does not.

Stollings, a doctor who is running for governor, has said those reimbursement rates need re-examination as hospitals all over the state struggle financially.

Mike Woelfel

Senator Mike Woelfel, D-Cabell, also asked about immediate needs for the money.

“So no one has reached out from the agencies to you that there’s a need for this money to be matched now for current services?” Woelfel asked.

Senate Finance Chairman Craig Blair, R-Berkeley, said the preference is to hold the money in reserve.

“Quite the opposite. They actually encouraged it,” Blair said.

Then, referring to the possibility of a state revenue downturn, Blair said, “They’re looking at this as a smoothing mechanism for the out years.”

Gov. Jim Justice

Gov. Jim Justice’s administration expects to have $309 million more for Medicaid spending than is anticipated to be necessary for the coming year.

They say that’s because the state’s unemployment rate has declined and the population has too, meaning fewer West Virginians qualify for the federal health care program for the poor. Meanwhile, a match of roughly three federal dollars for each dollar the state puts in makes the money go farther.

So Justice and his budget staff have proposed using that pot of Medicaid money in several ways:

First, using some of it to bridge an estimated gap of $108 million in General Revenue for the coming fiscal year.

Second, setting aside $150 million for a Medicaid Families First Reserve Fund. It was described as being like a Rainy Day Fund for the possibility of Medicaid funds running short in future years.

Third, additional spending of almost $50 million on child health and welfare initiatives such as eliminating the waiting list for intellectual and developmental disabilities waivers along with dedicating more money for child protective services.





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