Late last week, VHCA-VCAL submitted a request to Gov. Ralph Northam to increase Medicaid funding to address cost increases associated with preparation for and response to the COVID-19 outbreak. The request described that costs related to staffing issues and supplies, among other things, have already accrued and would increase significantly as the situation evolves. While our members get a handle on those costs, we asked that an initial increase be funded using the recently approved 6.2 percentage point increase to the Federal Medical Assistance Percentage (FMAP), which is the federal portion of funding for Medicaid in Virginia. LeadingAge Virginia cosigned the request.

Specifically, if the state would maintain the state Medicaid nursing facility funding levels in the recently passed General Assembly budget bills, VHCA-VCAL estimated the enhanced FMAP would generate approximately $120 million in “new” funds. Given that recent data shows about 6 million Medicaid days by Virginia NFs, this would roughly equate to a $20 per day rate increase without a cost to the Commonwealth. It would, however, reduce the potential savings to the state due to the enhanced FMAP by about $50 million, by our analysis.

VHCA-VCAL’s Executive Committee is speaking with Gov. Northam next week to discuss this and other COVID-related concerns. To date, we have not heard how the Commonwealth will be using the increased federal FMAP funding. Recent developments related to federal stimulus packages will likely influence how the FMAP increase is utilized.