Rhode Island working group identifies $85.5M in proposed cuts to Medicaid

April 21, 2015

Rhode Island's Reinventing Medicaid Working Group, created by Gov. Raimondo to identify Medicaid savings, issued recommendations including a 5% rate cut in Medicaid reimbursements for hospitals and 3% cut for nursing homes. The working group says its recommendations would cut $85.5 million in state expenditures, close to the $90 million goal included in Raimondo's budget. Documents show the total reductions would be worth $158.6 million, including federal funds. The list, which is not yet a formal recommendation from the group, includes:

  • An incentive package that would allow providers to make up some of the losses through bonuses awarded to organizations that move toward more efficient and higher quality care;
  • An incentive pool for nursing homes;
  • An increase in hospital licensing fees worth $22.6 million (total state and federal);
  • Coordinated home-based care for people with severe mental illness saving $6 million;
  • Reduce a neonatal intensive care unit adjustment by $3.8 million; and
  • An increase in nursing home bed tax worth $4 million (state only).