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Official: NMI Medicaid will lose ‘millions of dollars’ if local share is not funded adequately

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THE islands’ Medicaid program could forfeit “millions of dollars” in federal funding due to insufficient local appropriation, CNMI  Medicaid Director Helen C. Sablan told the Senate.

In her letter to the Senate Fiscal Affairs Committee chairman, Senate Vice President Jude U. Hofschneider, Sablan said the CNMI’s fiscal year 2021 budget proposal allots  $2.5 million  for the Medical Assistance Program and Enhanced Allotment Plan of Medicaid.

She said the Medical Assistance Program or MAP is the health insurance program under Title XIX that helps pay healthcare providers in accordance with the Medicaid State Plan approved by the Centers for Medicare and Medicaid Services.

The Enhanced Allotment Plan or EAP, for its part, provides health insurance funding for pharmaceuticals for Medicare and Medicaid “dual-eligibles,” Sablan said.

For the administration of the Medicaid program, the proposed local budget as approved by the CNMI House is $187,400 only.

Sablan said the administration costs are set in Title XIX to be 50% federal and 50% local.

She noted that in the proposed FY 2021 budget, “absolutely no funds were provided for utilities, office supplies, or any other operational expenses that would be funded at 50%-50% federal-territory matching.”

Moreover, Sablan said, the proposed FY 2021 budget provided “absolutely no funding” for the Medicaid Enterprise Systems.

By not providing the 10% territory match for the MES, she said, CNMI Medicaid “will not be able to make ‘reasonable and appropriate’ progress and will jeopardize the current and future funding for CNMI Medicaid program.”

She added, “It will be very difficult for the Commonwealth Medicaid Agency to explain to the Centers for Medicare and Medicaid Services, the U.S. Congress, or other federal agencies such as the Government Accountability Office or the Medicaid and CHIP Payment Advisory Commission and others that have already inquired that the ‘CNMI did not even fund the 10% of the projects’ even though the federal government has ‘increased funding immensely ($60 million for FY 2020 and 2021), and [when] the effective federal matching assistance is 89.2% of all Medicaid and 100% CHIP funding during the period of the public health emergency.”

Sablan presented a table indicating that under the proposed FY 2021 budget, the required Medicaid share of the Commonwealth faces a shortfall of $5.6 million.

She said, “The failure to fund the program would result in a loss of millions of dollars in healthcare funding that cannot be spent because of the lack of territory match.”

She said the funds  provided under the Consolidated Appropriations Act are a fiscal year appropriation and will be lapsed and de-obligated — the funds will be lost and not carried over into the new fiscal year.

“We do not believe that it is in the interest of the CNMI to lose millions of dollars in healthcare funding especially in an economic time when federal expenditures are one of the few sources of economic input into the economy, are needed by the many beneficiaries, especially since there has been a substantial increase due to furloughs and layoffs resulting from the economic impacts of the Covid-19 pandemic,” Sablan said.

She noted that her office has reported a 32.7% increase in Medicaid beneficiaries from February to July 10, 2020.

She said. “The direct consequence on the CNMI healthcare system is that both the private providers and clinics of the Commonwealth Healthcare Corp. will not be paid for the ‘fee for services’ or patients’ pharmaceutical needs without the territory match until the next fiscal year.”

Sablan said, “If funds are not appropriated at the levels requested in the Medical Assistance Program for the Medicaid program, [we] will need to inform the program beneficiaries and the providers that healthcare services can only be provided by…CHCC.”

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