Proposed Medicaid Cuts Imperil Vulnerable Populations and Caregivers

Last night, DSHS submitted a 2021-2023 biennial budget proposal to OFM that would decimate facility-based long term care, leaving thousands without critically-necessary services. Under the DSHS proposal, which is the first step in a protracted budgeting process, changes to client eligibility and across-the-board rates reductions would be significant and detrimental to the very settings embroiled in the battle against COVID-19.

Functional Eligibility Changes: Proposed changes to client eligibility standards would eliminate 12,000 individuals from receiving long term care supports and services. Click here for the DSHS analysis that details these and other reductions:

  • The client caseload for SNFs is reduced by 30 percent under the DSHS plan, resulting in a $444 million funding cut for the biennium.
  • The client caseload in assisted living is reduced by 38 percent under the DSHS plan, for a savings of $40.6 million for the biennium.
  • Caseloads for ARC/EARC and specialized dementia care are also reduced by 22 percent because of these eligibility changes, equating to a $32.6 million funding cut for the biennium.

    Across-the-board Medicaid rate reduction of 3 percent
     for all provider types beginning July 1, 2021.  If the eligibility reductions are simultaneously implemented, rate reductions would become 2.4 percent. The anticipated ALTSA rate cuts equate to $145 million over the 2021-23 biennium, of which WHCA members would see the following in reduced funding levels due to rate cuts:
  • SNFs = $38 million total funds
  • AL/ARC = $8 million total funds

SNF annual rebase with direct care and indirect care inflation: In addition to proposed cuts, the Department proposal seeks $23 million additional funding for the biennium to continue annual rebase with inflation for direct care and indirect care rates. Under the proposal, inflation is calculated at 2.53 percent.

Next steps: From here, the Office of Financial Management is charged with determining the final 2021-2023 biennial budget proposal. The Governor is charged with releasing a budget proposal in December; the House and Senate will follow by releasing proposals in early 2021.

While this is the beginning of a lengthy state budget process, we must strongly object to the DSHS proposal with the Governor’s Office and state legislators.

We ask that you strongly encourage your teams to oppose funding cuts proposed by DSHS. Click here to access our electronic advocacy site, where you can send a message to Governor Inslee and your legislators.

If you have questions or need additional information, please let me know.

Robin Dale
Washington Health Care Association
(800) 562-6170, ext. 101

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