Wisconsin Health News: Wisconsin’s Medicaid Budget Outlook Improves, But Shortfall Expected

Last Thursday, Wisconsin Health News reported that Wisconsin Medicaid’s financial outlook has improved, but the program faces an estimated $269.2 million shortfall in state dollars by the end of the current biennial budget. 

The amount is $53.2 million less than what the Department of Health Services previously estimated the deficit will be on June 30, 2027. 

Medicaid continues to see higher use of long-term care services, nursing homes, safety-net providers, prescription drugs and services for kids with disabilities than initially expected, DHS Secretary-designee Kirsten Johnson wrote in a Wednesday report to the co-chairs of the Legislature’s budget-writing committee. 

In addition, DHS expects increased costs across multiple service lines for the rest of the current fiscal year. 

The state agency is working to reduce the projected deficit. DHS applied federal revenue claimed for school medical services and not allocated to school districts to offset state spending on Medicaid benefits, Johnson said. Doing so does not affect what school districts receive for Medicaid services under state law, she added. 

A Legislative Fiscal Bureau memo this summer suggested lawmakers may need to act to address the projected shortfall.