DHHS Presents 2014-2015 Budget Request

DHHS Director Tony Keck presented his budget request for the 2014-2015 fiscal year.

South Carolina Department of Health and Human Services (DHHS) Director Tony Keck presented his budget request for the 2014-2015 fiscal year before the House Ways and Means Healthcare Subcommittee chaired by Rep. Murrell Smith (R-Sumter). Fellow subcommittee members Rep. Bill Clyburn (D-Aiken), Rep. Tracy Edge (R-Horry), and Rep. Bill Herbkersman (R-Beaufort) were also present for the testimony.
Keck began his presentation with a recap of the 2013 DHHS budget, recognizing that DHHS ended the year with a $384 million surplus. While some of the savings his agency realized were due to increased use of generic drugs and lower than expected electronic health records costs, much of the surplus can be attributed to the Agency over-projecting the financial impact of the Affordable Care Act (ACA) in South Carolina.
Last year, DHHS projected that thousands of South Carolinians who are currently eligible but unenrolled in Medicaid would apply for coverage due to increased marketing and advertising surrounding new coverage models under the ACA. The Agency also predicted that citizens with health coverage would “crowd-out” of their current plans once they became aware they were eligible for Medicaid. However, neither of these trends took hold, and Keck attributed that to technical problems with Healthcare.gov and delays in some key provisions of the ACA. Keck explained that he now expects that rush for coverage during the next enrollment period. He characterized DHHS as being “over-reserved” with funding.
Subcommittee members were also updated on the progress of the “Healthy Outcomes Plan (HOP)” provided by Proviso 33.34 in last year’s DHHS Budget. Keck credited hospitals for achieving 100% participation in the initiative, while recognizing that only 1,326 of the targeted 8,511 chronically ill patients were enrolled so far. “Hospitals are finding that it’s very difficult to manage these people,” said Keck. His continued goal is to use the HOP program to encourage more outreach from hospital providers and more accountability among frequent emergency room visitors. DHHS and SCHA will continue this commitment to South Carolina’s chronically ill in the coming fiscal year, and SCHA looks forward to being at the table for these discussions.
Keck also presented other new initiatives undertaken by the Agency, including the new website (www.schealthdata.org) aimed at hospital pricing transparency, paying physicians to treat obesity-related diseases and some Medicaid cost-saving provisions modeled after the ones placed on Medicare by the ACA. Specifically, he is proposing Medicaid penalties for unnecessary hospital readmissions and strengthening policy prohibiting payments from hospital acquired conditions. Chairman Smith advised Keck that he believed some of the readmissions penalties were too harsh on hospitals, given they can’t control the behavior of the patient once they leave the facility. The subcommittee ultimately adopted the DHHS provisos that did not include funding, carrying over the rest for future debate.