FY 2016 Appropriation

The Division of Medicaid and Health Financing is the administrative agency for Utah's Medical Assistance Programs (Medicaid, Children's Health Insurance Program, Utah's Premium Partnership for Health Insurance, and Primary Care Network). As per federal requirements, all funding for Medicaid must flow through the Department of Health via a memorandum of understanding for all functions performed by other entities whether State, non-profit, for profit, local government, etc. About 32% of clients receive their medical services from any willing provider who bills Medicaid directly. The other 68% of clients receive most of their medical services through four contracted health plans who handle the billing and case management services of their clients.

Funding History
Appropriation Overview

During the 2015 General Session, the Legislature appropriated for Fiscal Year 2016, $108,839,600 from all sources for Medicaid and Health Financing. This is an 8 percent reduction from Fiscal Year 2015 revised estimated amounts from all sources. The total includes $5,064,300 from the General/Education Funds, a reduction of 13.9 percent from revised Fiscal Year 2015 estimates.

Appropriation Adjustments

In addition to statewide compensation and internal service fund cost increases, the following appropriation adjustments were made during the 2015 General Session:

DescriptionOngoingOne-Time ARRA Adjustments$0$833,000
OngoingOne-TimeFinancing Source
$0$833,000American Recovery and Reinvestment Act
The Legislature expressed interest in reviewing the federal stimulus or American Reinvestment and Recovery Act (ARRA) money separate from the annual review of federal funds.
Dedicated Credits Increase$7,000$0
OngoingOne-TimeFinancing Source
$7,000$0Dedicated Credits Revenue
(1) An increase of $802,200 in dedicated credits in FY 2016 in the Department of Health's Executive Director's Operations line item for $383,700 for potential sales from five new products from the All Payer Claims Database, $250,000 for contract for implementing the Master Person Index, and $168,500 for increased fees in vital records to offset declines in fee quantities. (2) An increase of $10,002,000 in dedicated credits in FY 2016 in the Department of Health's Medicaid Mandatory Services line item which is just a shift from the Medicaid Optional Services line item, but no overall increases for dedicated credits in Medicaid services. (3) $27,500 in ongoing dedicated credits beginning in FY 2016 for the Department of Health for a new federal surplus resale program where state agencies can receive dedicated credits from the sale of property/equipment. (4) For the Department of Health's Disease and Prevention Control line item as dedicated credits - Health: "Grant from the Association of Public Health Laboratories for $148,100. The purpose of this proposal is to establish molecular testing (Severe Combined Immunodeficiency) within the Utah Public Health Laboratory. Through this mechanism we explore and implement a cross-testing section process to advance Newborn Screening and the Infectious Disease group. The grant finances research and development work to implement a mandated test. All future cost will be covered completely through revenue generated through test fees."
Medicaid Accountable Care Organizations Reimbursement Rates$2,100,000 ($2,100,000)
OngoingOne-TimeFinancing Source
$2,100,000$0General Fund
$0 ($2,100,000)General Fund, One-time
Enactment of this legislation likely will not materially impact state revenue. Enactment of this legislation may increase ongoing costs to the Department of Health beginning in FY 2017 by $2,000,000 General Fund and $4,700,000 federal funds for increased per member per month reimbursement to Medicaid accountable care organizations. In FY 2018 there may be ongoing costs of $2,100,000 General Fund and $5,000,000 federal funds.
Staff Analysis

Issue Brief - 2014 General Session - Medicaid Spending Statewide

Medicaid's Inspector General (OIG) - UCA 63A-13-502 directs that: "The inspector general of Medicaid services shall provide the report described in Subsection (1) to the Executive Appropriations Committee of the Legislature and to the governor on or before October 1 of each year. The inspector general of Medicaid services shall present the report described in Subsection (1) to the Executive Appropriations Committee of the Legislature before November 30 of each year." The report is available at http://le.utah.gov/interim/2014/pdf/00004431.pdf. Below are some quotes from the report:

  1. "Taxpayer Funds Collected $11,570,604"
  2. "Utah OIG completed 31 provider outreach trainings, visiting nearly all Utah counties, and 4 professional groups during FY 2014, to help educate providers and reduce future instances of waste, abuse, and fraud."
  3. "The Special Investigations Unit conducted 1,287 investigations, incorporating 8,418 medical claims in FY 2014. Investigations included Durable Medical Equipment, Pharmacy, Home Health, Hospitals, Hospice, Physicians and Dental providers. The 8,418 medical claims included: 3,004 that required no action, 3,202 that received notification of a Utah OIG action, and 2,216 are currently in various stages of the review process."
  4. "The Performance Audit team released 15 audits with 56 recommendations to Medicaid in FY 2014. Medicaid agreed with all 56 recommendations and has already implemented 22 of them; the other 34 have scheduled implementation dates. The Utah OIG Audit team identified $1.3 million in federal match money that was inappropriately drawn down from CMS."

Additional Measures

Average Days to Approve Placement of Medicaid Clients in Nursing Home Facilities

Average Days to Approve Placement of Medicaid Clients in Nursing Home Facilities

Medicaid Spending ($ in Millions)

Average Decision Time in Hours on Pharmacy Prior Authorizations

Average Decision Time in Hours on Pharmacy Prior Authorizations

Medicaid Spending ($ in Millions)

Average Days to Approve Placement of Medicaid Clients in Nursing Home Facilities

Medicaid Spending ($ in Millions)

Percent of Clean Claims Adjudicated Within 30 Days of Submission

Percent of Clean Claims Adjudicated Within 30 Days of Submission

Total Count of Medicaid and CHIP Clients Educated on Proper Benefit Use

Total Count of Medicaid and CHIP Clients Educated on Proper Benefit Use

Statute

The Division of Medicaid and Health Financing is governed by several chapters of the Utah Health Code in Title 26 of the Utah Code.

  • UCA 26-18 establishes the Medical Assistance Program, commonly referred to as Medicaid and its administrative arm, the Division of Medicaid and Health Financing.
  • UCA 26-18-2.2 requires that the Medicaid director be appointed by the Governor with the consent of the Senate.
  • UCA 26-18-3 directs the Department of Health to enroll all Medicaid beneficiaries in the electronic exchange of clinical health records unless the individual opts out.
  • UCA 26-18-402 establishes the Medicaid Restricted Account from unexpended General Funds. The statute says that the Legislature might appropriate the money for expanding medical assistance coverage.
  • UCA 26-19 authorizes the Health Department to recover Medicaid benefits paid by the Division from third parties, including estates and trusts.
  • UCA 26-20 prohibits false Medicaid claims and establishes the Medicaid Fraud Control Unit.
  • UCA 26-35a creates the Nursing Care Facilities Account and levies an assessment on the owners of nursing care facilities to generate seed money which draws down additional federal funds for the reimbursement to those facilities.
  • UCA 26-47 requires the Department to create a Prescription Drug Assistance Program to assist individuals who need help in obtaining prescription drugs at a reduced cost or at no cost.
  • UCA 67-5-1 details the responsibilities of the Attorney General to investigate and prosecute abuse and neglect.

Federal regulations provide for a wide variety of funding ratios ranging from 50 to 90 percent for different classes of positions and functions for this Division. The Division includes the following seven offices or bureaus: Director's Office, Financial Services, Eligibility Policy, Coverage and Reimbursement, Medicaid Operations, Managed Health Care, and Authorization and Community Based Services. The Division also includes the following three budget programs: DWS Seeded Services, Other Seeded Services, and Contracts.

Federal law requires that the Medical Care Advisory Committee serve as an advisory board to the Division. This committee consists of providers, Medicaid recipients, representatives from the Department of Human Services and the Department of Workforce Services, and members of the community. The committee advises the Division on program content, policy, and priorities. The Committee is advisory and its decisions are not binding on the Division.

Medicaid Fraud Control Unit

The Medicaid Fraud Control Unit's mission is: "To protect the integrity of the Medicaid program and the safety and property of institutionalized citizens of the State of Utah through skilled detection, proactive investigation, prevention, prosecution and financial recovery." The Unit operates in the Attorney General's Office and focuses on criminal and civil actions against fraudulent providers and perpetrators of neglect and abuse against vulnerable adults in care facilities.

Intent Language

HB0003: Item 78

Under Section 63J-1-603 of the Utah Code, the Legislature intends up to $475,000 provided for the Department of Health's Medicaid and Health Financing line item in Item 24 of Chapter 13, Laws of Utah 2014 shall not lapse at the close of Fiscal Year 2015. The use of nonlapsing funds is limited to compliance with federally mandated projects and the purchase of computer equipment and software.


HB0003: Item 78

Under Section 63J-1-603 of the Utah Code, the Legislature intends up to $1,000,000 provided for the Department of Health's Medicaid and Health Financing line item in Item 70 of Chapter 282, Laws of Utah 2014 shall not lapse at the close of Fiscal Year 2015. The use of nonlapsing funds is limited to the purchase of telehealth equipment.


SB0002: Item 72

The Legislature intends that the Inspector General of Medicaid Services pay the Attorney General's Office the full state cost of the one attorney FTE that it is using at the Department of Health.


SB0007S01: Item 3

All General Funds appropriated to the Department of Health - Medicaid and Health Financing line item are contingent upon expenditures from Federal Funds - American Recovery and Reinvestment Act (H.R. 1, 111th United States Congress) not exceeding amounts appropriated from Federal Funds - American Recovery and Reinvestment Act in all appropriation bills passed for fiscal year 2016. If expenditures in the Medicaid and Health Financing line item from Federal Funds - American Recovery and Reinvestment Act exceed amounts appropriated to the Medicaid and Health Financing line item from Federal Funds - American Recovery and Reinvestment Act in fiscal year 2016, the Division of Finance shall reduce the General Fund allocations to the Medicaid and Health Financing line item by one dollar for every one dollar in Federal Funds - American Recovery and Reinvestment Act expenditures that exceed Federal Funds - American Recovery and Reinvestment Act appropriations.


SB0007S01: Item 3

The Legislature intends that the Department of Health report on the following performance measures for the Medicaid and Health Financing line item: (1) average decision time on pharmacy prior authorizations (Target = 24 hours or less), (2) percent of clean claims adjudicated within 30 days of submission (Target = 98%), and (3) total count of Medicaid and CHIP clients educated on proper benefit use and plan selection (Target = 90,000 or more) by January 1, 2016 to the Social Services Appropriations Subcommittee.


SB0007S01: Item 14

All General Funds appropriated to the Department of Health - Medicaid and Health Financing line item are contingent upon expenditures from Federal Funds - American Recovery and Reinvestment Act (H.R. 1, 111th United States Congress) not exceeding amounts appropriated from Federal Funds - American Recovery and Reinvestment Act in all appropriation bills passed for fiscal year 2016. If expenditures in the Medicaid and Health Financing line item from Federal Funds - American Recovery and Reinvestment Act exceed amounts appropriated to the Medicaid and Health Financing line item from Federal Funds - American Recovery and Reinvestment Act in fiscal year 2016, the Division of Finance shall reduce the General Fund allocations to the Medicaid and Health Financing line item by one dollar for every one dollar in Federal Funds - American Recovery and Reinvestment Act expenditures that exceed Federal Funds - American Recovery and Reinvestment Act appropriations.


SB0007S01: Item 14

The Legislature intends that the Department of Health report on the following performance measures for the Medicaid and Health Financing line item: (1) average decision time on pharmacy prior authorizations (Target = 24 hours or less), (2) percent of clean claims adjudicated within 30 days of submission (Target = 98%), and (3) total count of Medicaid and CHIP clients educated on proper benefit use and plan selection (Target = 90,000 or more) by January 1, 2016 to the Social Services Appropriations Subcommittee.


For analysis of current budget requests and discussion of issues related to this budget click here.

Display By:
Appropriation Type:
Appropriation History by
Show Table   |   Show Additional Information

COBI contains unaudited data as presented to the Legislature by state agencies at the time of publication. For audited financial data see the State of Utah's Comprehensive Annual Financial Reports.