AK: State freezes hospital and nursing home Medicaid rates

JUNEAU — Alaska’s Office of Rate Review is sending out notifications to hospitals and nursing homes that the Medicaid inflationary rate increase has been frozen for the 2016 fiscal year. According to the Alaska State Hospital and Nursing Home Association (ASHNHA), this decision came without consulting any hospitals or nursing homes, and comes with the bare minimum of 30 days notice before the freeze goes into effect on July 1st.

This decision comes in response to a deepening fiscal crisis for the state, with oil prices plummeting and the legislature so far unable to come to an agreement on a budget. When reached for comment, Jared Kosin, Executive Director at the Office for Rate Review said of the freeze:

The costs of medical assistance for all persons eligible…is expected to exceed the amount allocated in the SFY 2016 budget. Given these circumstances, the department is implementing a cost containment measure…to immediately preserve eligibility and services to protect the health and general welfare of Medicaid recipients. Part of the cost containment measure will eliminate inflation adjustments to certain Medicaid payment rates in [State Fiscal Year] 2016. The Department anticipates adopting regulations to implement this action for hospital, nursing home, ambulatory surgery center Medicaid payment rates and other rates in the very near future.

Alaska Medicaid rates are one of the few in the country that receive regular inflationary adjustments. The Office will hold a review hearing for stakeholders on June 30th.