Medicaid enrollment strains public finances in New Mexico

Medical personnel conduct drive-thru COVID-19 testing May 4 at Rehoboth McKinley Christian Health Care Services in Gallup. Dr. David Scrase, secretary of the state Human Services Department, is warning that COVID-19 infections are disproportionately afflicting the poor, a trend that is likely to drive up Medicaid spending.

Enrollment in Medicaid has increased by nearly 7 percent in New Mexico since the outset of the novel coronavirus pandemic as employers shed jobs and more families descend into poverty, state health regulators told a panel of legislators Friday.

Human Services Secretary David Scrase praised federal legislation approved in March that increased the federal matching rate for Medicaid health care and allowed the state to quickly extend no-charge coronavirus testing to the poor and undocumented immigrants.

At the same time, he said the current 6.2 percent boost in federal matching funds is inadequate to keep up with rebounding demand for medical services under Medicaid and could end abruptly at the discretion of federal health regulators.

He warned that changes to a federal public health emergency declaration could thrust as much as $150 million in annual Medicaid obligations into the state general fund. He said it is too soon to know how the federal government will proceed in a presidential election year.

“I think our congressional delegation is well aware of the need to sustain funding in the Medicaid program through at least June of 2021,” he said.

The federal government now provides $4.15 for every dollar in state general fund spending on Medicaid spending, up from $3.54 before the pandemic, Medicaid Assistance Director Nicole Comeaux told legislators.

That federal support has enormous implications for public health, where more than half of children get health care through Medicaid. The program covers 72 percent of births statewide.

Gov. Michelle Lujan Grisham is asking most executive agencies to trim general fund spending by 5 percent as the state confronts a nearly billion-dollar annual deficit. Scrase said the target for cuts at Human Service Department is 3 percent. The agency is a conduit for multibillion-dollar annual federal spending on health care, food stamps and emergency income assistance.

The state has earned federal approvals to tailor Medicaid to the local pandemic response — allowing reimbursement to physicians for remote telehealth appointments and underwriting drive-thru coronavirus testing.

Undocumented immigrants who test positive for COVID-19 won’t receive Medicaid support, Scrase said. Those resources will come from the Health Resources and Services Administration, a federal agency that attends to people who are geographically isolated and medically vulnerable.

Scrase is warning that COVID-19 infections are disproportionately afflicting the poor, a trend that is likely to drive up Medicaid spending. Just over 1 percent of the state’s population has tested positive.

Medicaid enrollment among Native Americans has increased by 3 percent since March, or about 4,000 people, even though indigenous communities can opt for federally subsidized care through Indian Health Services.

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