The 2017 Executive Budget Document
Governor McAuliffe's Proposed Amendments to the 2016-2018 Biennial Budget
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Released on December 16, 2016 
 
Department of Medical Assistance Services [602]
Secretarial Area: Health and Human Resources
Operating Budget Summary
This table shows the Governor's proposed budget for the next two years and the agency's official budget for the previous six years.
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Biennium Fiscal Year Source GF NGF Total
2012-2014 2013 Chapter 1, 2014 Acts of Assembly $3,547,761,312 $4,525,123,550 $8,072,884,862
2012-2014 2014 Chapter 1, 2014 Acts of Assembly $3,669,406,166 $4,829,310,906 $8,498,717,072
2014-2016 2015 Chapter 732, 2016 Acts of Assembly $3,846,847,641 $4,786,951,421 $8,633,799,062
2014-2016 2016 Chapter 732, 2016 Acts of Assembly $4,266,731,052 $5,073,691,875 $9,340,422,927
2016-2018 2017 Governor's Proposed Budget $4,454,824,008 $5,476,474,110 $9,931,298,118
    2016 Appropriation $4,411,533,662 $5,329,249,375 $9,740,783,037
    Governor's Amendments $43,290,346 $147,224,735 $190,515,081
2016-2018 2018 Governor's Proposed Budget $4,733,525,877 $5,621,352,147 $10,354,878,024
    2016 Appropriation $4,547,698,514 $5,436,918,443 $9,984,616,957
    Governor's Amendments $185,827,363 $184,433,704 $370,261,067
Positions Budget Summary
Biennium Fiscal Year Source GF NGF Total
2012-2014 2013 Chapter 1, 2014 Acts of Assembly 183.82 212.18 396.00
2012-2014 2014 Chapter 1, 2014 Acts of Assembly 198.32 226.68 425.00
2014-2016 2015 Chapter 732, 2016 Acts of Assembly 210.37 216.63 427.00
2014-2016 2016 Chapter 732, 2016 Acts of Assembly 225.02 234.98 460.00
2016-2018 2017 Proposed Positions 232.02 241.98 474.00
    2016 Appropriation 232.02 241.98 474.00
    Governor's Amendments 0.00 0.00 0.00
2016-2018 2018 Proposed Positions 233.52 243.48 477.00
    2016 Appropriation 232.02 241.98 474.00
    Governor's Amendments 1.50 1.50 3.00
Operating Budget Addenda (in order of greatest impact)
•
Fund Medicaid utilization and inflation Decision Package
  Provides funding for the cost of Medicaid utilization and inflation as estimated in the most recent forecast expenditures.
 
  FY 2017 FY 2018
General Fund $84,322,141 $196,343,872
Nongeneral Fund $109,934,259 $162,757,446
•
Adjust Health Care Fund appropriation Decision Package
  Modifies the appropriation for the Virginia Health Care Fund to reflect the latest revenue estimates. Tobacco taxes are projected to decrease by $2.8 million in FY 2017 and $4.4 million in FY 2018 based on the Department of Taxation's revised forecast. Conversely, Medicaid recoveries are expected to increase by $10.6 million in FY 2017 and $13.6 million in FY 2018. The estimates also account for a $44.3 million prior year cash balance carried over from FY 2016. Since the fund is used as state match for Medicaid, any change in revenue to the fund impacts general fund support for Medicaid.
 
  FY 2017 FY 2018
General Fund ($34,705,234) ($9,231,567)
Nongeneral Fund $34,705,234 $9,231,567
•
Adjust Medicaid forecast to account for revised Medicare premiums Decision Package
  Accounts for Medicare premium rates that were finalized after the consensus Medicaid forecast was completed. During the development of the Medicaid forecast, due November 1, the Departments of Planning and Budget and Medical Assistance Services had to use preliminary assumptions on Medicare premium rates. Since the forecast was finalized, the federal government has released actual Medicare Part A, B, and D rates for FY 2017. The changes will allow the forecast to be lowered by $47.2 million total funds (over the biennium); thereby reducing the general fund need by $25.5 million.
 
  FY 2017 FY 2018
General Fund ($7,293,635) ($18,238,863)
Nongeneral Fund ($6,165,602) ($15,460,168)
•
Fund Family Access to Medical Insurance Security utilization and inflation Decision Package
  Adjusts funding for the FAMIS program to reflect the latest forecast of expenditures. The costs are primarily a result of higher than expected managed care rates and an increase in service utilization.
 
  FY 2017 FY 2018
General Fund $2,262,730 $2,789,519
Nongeneral Fund $16,374,286 $19,890,297
•
Adjust appropriation to reflect current services Decision Package
  Adjusts the agency's base budget to reflect current operations. The amendment adds $8.0 million of federal appropriation in each year that was omitted in last year's budget. In addition, $20.0 million is reduced annually to reflect expected expenditures in the federal provider incentive payment program as more providers complete their payment cycles. This technical action makes the Appropriation Act more transparent and limits the need for administrative transactions.
 
  FY 2017 FY 2018
Nongeneral Fund ($12,000,000) ($12,000,000)
•
Allow consumer-directed attendants to receive overtime pay for up to 56 hours Decision Package
  Authorizes the Department of Medical Assistance Services (DMAS) to pay overtime compensation to attendants who are providing care under the consumer-directed service option in the Medicaid waivers. This amendment replaces current language prohibiting overtime hours being worked by consumer-directed attendants with language that allows DMAS to pay time and a half for up to 56 hours for a single attendant who works more than 40 hours per week.
 
  FY 2017 FY 2018
General Fund $0 $8,535,844
Nongeneral Fund $0 $8,535,844
•
Fund medical assistance services for low-income children utilization and inflation Decision Package
  Adjusts funding for the Commonwealth's Medicaid Children's Health Insurance Program to reflect the latest expenditure forecast. Children between the ages of 6 and 19, with family income from 100 to 133 percent of the federal poverty level, are eligible for this program. The costs are largely attributable to increased managed care rates and higher utilization of services.
 
  FY 2017 FY 2018
General Fund $657,633 $927,937
Nongeneral Fund $4,426,558 $5,967,768
•
Restore inflation for nursing facilities Decision Package
  Funds the full value of inflation, an adjustment of 2.5 percent, for nursing facilities in fiscal year 2018. Chapter 780 assumes an inflation adjustment of 1.25 percent in fiscal year 2018.
 
  FY 2017 FY 2018
General Fund $0 $5,454,111
Nongeneral Fund $0 $5,454,111
•
Provide same-day access to evaluation services at community services boards Decision Package
  Funds the Medicaid costs associated with providing assessment and evaluation services to individuals through local community services boards and behavioral health authorities as a result of the implementation of the same-day access initiative. An accompanying amendment in the Department of Behavioral Health and Developmental Services accounts for the non-Medicaid population served as a result of this initiative.
 
  FY 2017 FY 2018
General Fund $0 $1,332,750
Nongeneral Fund $0 $1,332,750
•
Reflect October 2016 Savings in agency budgets Decision Package
  Reflects the savings included in the Governor's October 2016 Savings Plan.
 
  FY 2017 FY 2018
General Fund ($2,003,289) $0
•
Conduct audits of "DRG" payments using agency staff Decision Package
  Captures savings associated with performing audits with agency staff. The shift to managed care reduces fee-for-service business, lowers the volume of services DMAS needs to audit, and makes it possible for the agency to complete hospital diagnosis related group (DRG) payment audits without an outside contractor.
 
  FY 2017 FY 2018
General Fund $0 ($688,013)
Nongeneral Fund $0 ($688,013)
•
Enhance estate recovery efforts Decision Package
  Increases the size of the estate recovery program from two positions to five. The department maintains that the additional positions will enhance the efforts of the Medicaid recovery unit to improve collections by an estimated $1.0 million total funds.
 
  FY 2017 FY 2018
General Fund $0 ($372,318)
Nongeneral Fund $0 $620,530
Positions 0.00 3.00
•
Reduce funding for contract reprocurements for fiscal year 2018 Decision Package
  Captures funding associated with delayed reprocurements. Chapter 780 provided $800,000 general fund in FY 2018 for the agency to cover contract reprocurement costs. The anticipated procurements will now occur one year later than previously assumed; therefore only half of the funding for FY 2018 is necessary. All FY 2017 funding was captured as part of the 2017 savings plan.
 
  FY 2017 FY 2018
General Fund $0 ($400,000)
Nongeneral Fund $0 ($400,000)
•
Conduct audits of "DME" and pharmacy services with agency staff Decision Package
  Assumes that more durable medical equipment (DME) and pharmacy audits will be performed using agency staff. The shift to managed care reduces fee-for-service business, lowers the volume of services DMAS needs to audit, and makes it possible for the agency to complete more audits using agency staff and a reduced number of contracts with vendors.
 
  FY 2017 FY 2018
General Fund $0 ($373,433)
Nongeneral Fund $0 ($373,433)
•
Fund medical services for involuntary mental commitments Decision Package
  Increases funding for the cost of hospital and physician services for persons subject to an involuntary mental commitment. The most recent forecast of expenditures projects higher FY 2018 costs than previously estimated.
 
  FY 2017 FY 2018
General Fund $0 $605,189
•
Capture administrative savings Decision Package
  Accounts for savings associated with improved agency operations and efficiencies initiated by the Office of Medical Director.
 
  FY 2017 FY 2018
General Fund $0 ($279,887)
Nongeneral Fund $0 ($279,887)
•
Capture turnover and vacancy savings Decision Package
  Accounts for savings associated with agency positions being vacant for longer periods of time.
 
  FY 2017 FY 2018
General Fund $0 ($264,113)
Nongeneral Fund $0 ($264,113)
•
Assume higher nongeneral fund share of information technology staff costs Decision Package
  Captures general fund dollars associated with certain DMAS staff who now qualify for a higher federal match rate (75 percent or 90 percent) than currently assumed (50 percent).
 
  FY 2017 FY 2018
General Fund $0 ($250,000)
Nongeneral Fund $0 $250,000
•
Adjust institutional rate setting/auditing scope of work consistent with payment methodology changes Decision Package
  Transitions to more price-based (less cost-based) payment systems has reduced the need to audit costs, so the agency can revise the scope of institutional provider rate setting and auditing.
 
  FY 2017 FY 2018
General Fund $0 ($250,000)
Nongeneral Fund $0 ($250,000)
•
Reduce contract costs for the Cover Virginia Call Center and Central Processing Unit Decision Package
  Generates savings by reducing the cost of the contracts associated with the Cover Virginia Call Center and Central Processing Unit.
 
  FY 2017 FY 2018
General Fund $0 ($106,237)
Nongeneral Fund $0 ($318,711)
•
Correct fund split for prior action related to the MLTSS initiative Decision Package
  Adds general fund dollars to fully fund the oversight costs of implementing the Managed Long-Term Services and Supports (MLTSS) initiative. The funding provided in Chapter 780 over-appropriates the federal share while shorting the general fund need. This technical amendment corrects the fund split used in last year's MLTSS budget amendment.
 
  FY 2017 FY 2018
General Fund $50,000 $125,000
Nongeneral Fund ($50,000) ($125,000)
•
Perform federally required substance abuse (ARTS) waiver evaluation Decision Package
  Provides funding to conduct an independent evaluation of the new Addiction and Recovery Treatment (ARTS) benefit, as required by the federal government. During waiver negotiations in summer 2016, the Centers for Medicare and Medicaid Services (CMS) informed the department that the Commonwealth must contract with external academic researchers to conduct an independent evaluation to determine the effectiveness of the state’s ARTS training and the impact of the ARTS benefit and waiver on members’ health outcomes, service utilization and health care costs.
 
  FY 2017 FY 2018
General Fund $0 $150,000
Nongeneral Fund $0 $150,000
•
Conduct readiness reviews for new managed care organizations Decision Package
  Provides funding to conduct readiness reviews for new managed care organizations (MCO). The new organizations would operate as part of the re-procured Medallion (4.0) program, which currently serves more than 700,000 individuals. A readiness review is an impartial assessment to assess a health plan’s preparedness to operate as a Medicaid MCO.
 
  FY 2017 FY 2018
General Fund $0 $67,572
Nongeneral Fund $0 $202,716
•
Assume a higher federal match rate for software licenses Decision Package
  Captures general fund savings associated with a higher federal match rate. Change in federal policy with respect to match rates for certain information technology expenses will allow the agency to reduce the state share of a large license cost from 50 percent to 25 percent.
 
  FY 2017 FY 2018
General Fund $0 ($125,000)
Nongeneral Fund $0 $125,000
•
Comply with federal access requirements Decision Package
  Provides funding to comply with new federal requirements to conduct service access analysis. The Centers for Medicare and Medicaid Services (CMS) promulgated a new rule in November 2015 for the purpose of ensuring that states comply with access standards in the Social Security Act and regulations.
 
  FY 2017 FY 2018
General Fund $0 $75,000
Nongeneral Fund $0 $75,000
•
Clarify Commonwealth Coordinated Care (CCC) reporting requirements Decision Package
  Modifies the reporting requirement for the Commonwealth Coordinated Care (CCC) program to clarify that the report is due 30 days after the end of each quarter. Current language makes this report due at the end of the quarter, which is technically the day after the quarter ends. However, the data required to complete the report is not available until after the quarter ends. This language amendment allows the agency to be in compliance with Act requirements.
•
Ensure all appropriated Virginia Health Care Fund cash is available for expenditure Decision Package
  Provides the agency with a $15.0 million line of credit to ensure that all cash deposited into the Virginia Health Care Fund is available to expend in the fiscal year in which it was appropriated.


pdocagy2014 - Executive Budget Document Agency Details - 06-25-2025 14:36:50