Maura Healey’s budget chief, Matt Gorzkowicz, had a split-second answer ready to go Wednesday when, after detailing the governor’s sweeping annual budget bill, a reporter asked what he expects to be the biggest fiscal-management challenge in the year ahead.
Health care costs, he replied almost immediately, a fitting choice as the state stares down the prospect of sharply rising Medicaid needs and an expected decline in federal funding that would otherwise ease the burden.
As is typically the case, the state’s Medicaid program, MassHealth, figures to be the single largest area of spending in the fiscal year 2027 budget proposal Healey unveiled Wednesday, accounting for $22.7 billion of the roughly $63.4 billion bottom line.
After federal reimbursements, budget-writers expect a net cost to the state of $9.3 billion, about 7.4 percent more than last year. That’s roughly twice the rate of overall spending growth in Healey’s annual budget, even after accounting for attempts to rein in the trend with targeted cuts.
Healey’s plan would cap dental benefits for adult MassHealth members at $1,000 per year and reduce funding for care management. She’ll also instruct MassHealth to take administrative steps to end coverage of GLP-1 drugs when used only for weight loss.
Taken together, those three steps would save $311 million in total MassHealth spending, or $110 million after accounting for federal reimbursements, according to Healey’s budget office.
Healey said her team looked for “places we can shave a little because we don’t have a choice.” Without those maneuvers and several other one-time fixes, she said, MassHealth spending would have increased by a double-digit percentage.
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Published by MassINC