Federal Medicaid Funds Helps Ohio Avoid Big Budget Hole
An increase in Ohio Medicaid caseloads could have blown a hole in the new two-year state budget. But Gov. Mike DeWine's new spending plan also includes a huge infusion of federal cash for Medicaid, which is the largest part of the state budget.
The federal government is continuing a temporary increase in the federal Medicaid assistance percentage, or FMAP. That percentage is calculated using each state's per capita income compared to the national per capita income.
A COVID-19 relief law passed in March 2020 temporarily increased FMAP by 6.2%. The White House has notified states that the increase will continue. For Ohio, that means $300 million per quarter, or $2.4 billion, over the two-year budget.
Ohio Department of Medicaid director Maureen Corcoran said there’s a condition attached to that money.
“To be sure that everybody has continuing Medicaid coverage throughout the pandemic as a kind of a safety net, CMS does not allow us to disenroll people or to change their benefits unless they move to another state or they pass away," Corcoran said.
Corcoran said the funding boost is a relief, since predicting the impact of the pandemic has been difficult.
“This pandemic has really broken all of the rules," Corcoran said. "We expected more people would come on Medicaid. And it's still a lot of people and it's a lot of money. But not as much as we would have expected."
Lt. Gov. Jon Husted said covering those costs without that federal money would absorb most of the $2.7 billion in the state’s rainy day fund.