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Alaska budget cuts to rely on expected Medicaid savings

Republican Gov. Mike Dunleavy’s administration has announced a final Medicaid reduction of $159.9 million, KTOO-FM reported Thursday.

The reduction represents more than half of the state’s overall $259.8 million operating budget cuts, despite Medicaid being an entitlement under federal law, officials said.

Once a state makes someone eligible for Medicaid, they are entitled to receive health care, and their provider is entitled to be paid, officials said.

“If the governor wants to make meaningful reductions in state spending, he almost has to cut Medicaid and education,” said Becky Hultberg, Alaska State Hospital CEO.

The Legislature previously cut $249 million from Medicaid; more than a third of what the state spends on the program, officials said.

The cuts rely on expected Medicaid savings, which will be difficult to achieve since about half of the reduction is delayed to a future date, officials said. The budget cut numbers may require the Legislature to pass a supplemental budget next year.

“We’re concerned that the governor’s Medicaid cuts are not transparent and that they’re not real,” Hultberg said. “They’re not transparent because the department has not identified how it is going to achieve these savings.”
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