Medicaid Projections Show Increase For County By Scott Nicholson & Marie Freeman The latest Medicaid projections for 2007-08 from the N.C. Division of Medical Assistance show Watauga County’s Medicaid bill could continue its steady rise despite broad efforts to shift all costs to state government. Despite a one-year freeze on any increases, current projections show Watauga taxpayers may be facing a $1.5 million bill for Medicaid in 2007-2008. Currently, the county is projected to spend $1.27 million under the level capped as a temporary measure to help county governments. According to the North Carolina Association of County Commissioners, the total county Medicaid share is projected to top half a billion dollars in 2007-08. If counties are mandated to pay 15 percent of the state’s Medicaid program services share in 2007-08, those costs are projected to come in at more than $517 million, an increase of $91 million based on 2005-06 costs. The General Assembly capped county costs for the current year at the 2005-06 levels, which would mean the state picks up the cost for any county-level increase. According to Watauga’s director of Social Services Jim Atkinson, that hasn’t happened yet. He said the county may have to spend up to $1,535,000, though that may be offset by some prescription drug rebates. Atkinson said he has charted county Medicaid expenses since 1995, when the county budgeted $680,000 but spent about $635,000. Medicaid budgeting is a moving target, because counties don’t know their actual expenditures until after the current fiscal year is over. The state recommends a budgeting amount based on a number of factors, and Atkinson said typically it’s higher than what the county actually spends. The number of people that are eligible for Medicaid has gradually increased along with the population growth of the county, but escalating health care and prescription drug costs have contributed to the growth in Medicaid spending. Atkinson said he recommends to the commissioners each year that budgeting remain at recommended levels even though the final bill may be lower. He said only once in the past 12 years has the county spent more on Medicaid than was budgeted, and that caused a scramble to free up additional money. “We generally run a little bit under,” Atkinson said. “We budget what the state says we should because we’re afraid not to.” The county commissioners have adopted a resolution supporting the end of county payments for Medicaid, and it’s been a top NCACC legislative goal for years. North Carolina remains the last state in the country that still requires counties to fund a local portion of Medicaid. A federal bill has been introduced to end the practice, and some state lawmakers have supported the change. Atkinson said he’s heard the same talk as everyone else that Medicaid expenses will be capped, but he said, “Until I see it in writing, I’m not counting any chickens.” Each Watauga resident pays an average of $35 per year for Medicaid at the local level, which doesn’t include tax money paid to federal and state governments that is also spent on the program, which provides health care for low-income people. About 9.5 percent of Watauga residents are eligible for Medicaid, which is about half the statewide average. Watauga’s portion of Medicaid payments has increased 50 percent over the last eight years. Watauga, which is in sounder fiscal shape than most counties, earmarks about seven percent of its local tax revenues for Medicaid. In 50 of the state’s 100 counties, more is spent on Medicaid than on school construction, and in six counties, more is spent on Medicaid than is spent on the local school system’s operational budget. The NCACC is distributing resolution forms to county governments, an annual exercise that so far has yielded little besides a stack of mail to state legislators. Counting local, state and federal contributions, Watauga County residents run up $28 million per year in health costs billed to Medicaid.