Fitch: Kentucky's Medicaid Costs Up More Than 40 Percent

Jul 24, 2018

Kentucky’s Medicaid administrative costs jumped by more than 40 percent after the adoption of controversial work requirements for some able-bodied recipients – that’s according to a new report out this week by Wall Street credit rating agency Fitch. 

Credit AP File Photo

In a press release, the agency worries that direct costs for Medicaid work requirements could "limit savings from enrollment declines. Work requirements require tracking systems that few, if any, states have."

Jason Bailey with the liberal-leaning Kentucky Center for Economic Policy tells KET the state is spending the money on a new unnecessary bureaucracy to track recipients’ compliance.

"It is an extremely complex and expensive system, and that's dollars we're not spending for healthcare, childcare, training, or things we know help move people forward," he told Kentucky Tonight.

But Cabinet for Health and Family Services Secretary Adam Meier says the state has spent under $10 million to implement the changes, and argues they will ultimately boost efficiency.

"Certainly to do the right thing and provide the wrap-around services that are needed, it is going to cost more than what we're doing today in administrative costs, but by moving them to a better place where they become self-sufficient we will save more so on the benefits side," he said.

The Bevin administration reinstated dental and vision benefits after canceling coverage earlier this month in the wake of a court decision striking down the state’s Medicaid waiver.