Management of Maine's Medicaid Program Directly Impacts State's Favorable Bond Ratings

While healthcare costs continue to soar nationwide, DHHS virtually eliminates growth MaineCare costs

AUGUSTA, Maine - While the cost in taxpayer-funded health care and overall healthcare across the nation continues to rise significantly, initiatives at the Maine Department of Health and Human Services are reducing costs and improving health in MaineCare, the State's Medicaid program.

This success in controlling growth, along with paying more than $700 million in hospital debt and other welfare reforms, has played an important role in affirming Maine's bond ratings from Moody's Investor Services and Standard & Poor's Rating Services, while improving Moody's outlook on the State's general obligation debt from negative to stable. As a result, Maine is well positioned today to seek the best rate possible for the state's taxpayers as it goes to the bond market to fund projects supporting Maine Maritime Academy, National Guard armories and highway and bridge construction that will put as many as 25,000 Mainers to work. "It is a huge win for Maine that the bond rating companies have
recognized the improved financial position of our state,'' said DHHS Commissioner Mary Mayhew. "This administration has focused on controlling the growth in programs like Medicaid and reducing costs and long-term debts, such as the hospital debt. We are proud that our prudent fiscal management at the Department has played a key role in this decision by the bond agencies." While the average growth of Medicaid nationwide hovers around five percent, MaineCare is projected to grow by less than two-tenths of one percent in State Fiscal Year 2014. Projections for Fiscal Year 2015 show no growth-perhaps even a slight decrease in cost. "When you are reeling from one financial crisis to the next, you are bailing out the boat and not charting a course,'' said Commissioner Mayhew. " The LePage Administration has focused on stabilizing the financial foundation for this Department and specifically the Medicaid/MaineCare program to ensure that the spending is more effectively managed and tied to meeting core needs and core populations, such as serving our elderly and disabled. "Our work to support primary care and members who are high utilizers of healthcare services to improve their access to primary care and reduce excessive emergency department have all contributed to a largely flat growth rate in Maine's Medicaid program. The emergency room diversion work has saved more than $9 million already," said Mayhew. "Other states are also facing significant shortfalls in their Medicaid programs as a result of their choices to expand Medicaid. The administration's decision not to expand Medicaid has significantly improved the fiscal outlook of this state. "We are doing all that we can to transform our system to one that is focused on the individual and the family, emphasizing critical access to primary care, ensuring resources are provided to meet the needs of our elderly and disabled populations, reforming payment to pay for quality, rather than volume, and improving health outcomes for Maine people," she said.