Monday, May 5, 2003 | 11:07 a.m.
CARSON CITY -- Surprises keep cropping up in Gov. Kenny Guinn's $4.8 billion budget -- and not all of them are pleasant.
The latest is that the costly Medicaid program, which provides medical care for the needy, could come up $24 million short over the next two years.
State Human Resources Director Mike Willden said Friday that a study shows that the projected number of Medicaid recipients in the next two years is less than originally projected.
But he said the research shows those enrolled are making more visits to doctors and hospitals and those costs are rising faster than predicted last November.
For instance, he said, there is a 23 percent higher than predicted cost in group care facilities for the disabled. He said the new cost is forecast at $1,679 per month per person.
The new research shows the cost of the Child Health Assurance Program, which cares for pregnant women and children in poverty, will rise 12 percent more than expected next fiscal year and 15 percent more in 2005.
The department made projections last November on its future needs in Medicaid, and they were updated recently, Willden said.
The good news, he said, is that some of the $24 million can be offset by reductions or increased revenue from other programs. For example, Willden said, one program with the hospitals will yield an additional $6 million to the state in each of the next two fiscal years.
In addition the budget for Nevada Check-Up, the low-cost insurance program for children of working families, can be reduced by $2.9 million over the next two years.
"But we still have an $8 million to $9 million problem in '05," Willden said.
Guinn's budget recommended $938.6 million in Medicaid spending for the next fiscal year, of which $318 million would come from the state's general fund, a 17.2 percent increase. The state would put up $327.7 million the following fiscal year.
The Senate-Assembly budget subcommittees have been also struggling to cover other adjustments to the budget.
The governor's budget did not recommend $5.3 million to cover the traditional subsidy for retired state employees for their health insurance.
James R. Richardson, a lobbyist for the Nevada Faculty Alliance of the university and a former chairman of the committee that ran the health program, called it a "big mistake."
In a letter to members of the budget subcommittee last week, Richardson wrote: "We urge in the strongest possible terms that this mistake be rectified in a manner that does not impact the individual state retirees who had worked long and hard for the state and deserve better treatment."
The Senate-Assembly budget subcommittee split on this issue. The Senate approved the health insurance appropriation without including the $5.3 million. Richardson said this would force rates up from $32 to $52 per month for retirees who are in the state's health insurance plan.
Richardson said the state Budget Office made a mistake.
"But they have not offered a reasonable solution to this severe problem by requesting a budget adjustment" that would restore the money, he said.
The Assembly side of the subcommittee did not take action.
Meanwhile, the Senate-Assembly budget subcommittee rejected Guinn's recommendation to add $20 million to his budget to cover the full costs of retirement for public schoolteachers.
Guinn did not include the $20 million in his original budget. The premiums for the state retirement system are going up 1.5 percent. School districts are paying the full monthly rate for teachers. But the law says that any increase must be shared.
The governor wanted the state to pick up the full premium.
If the subcommittee's action sticks, that will mean teachers will have to pay a 0.75 percent increase to the retirement system that covers all public employees in Nevada.
Many of the budgets in state government have been approved by the legislative budget subcommittees. But the subcommittees are still trying to tie up two major ones: education and human resources. Some final decisions are expected this week.
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