House analysts: HR1 and caseload growth could raise Michigan’s Medicaid and SNAP costs

House Fiscal Agency analysts told the Appropriations Committee that federal changes commonly referred to in the briefing as "HR 1" and higher Medicaid/SNAP caseloads are key contributors to projected general-fund pressure and administrative workload.

Kevin Khoskra said one major baseline cost is tied to changes in the food assistance program under HR 1, which increases the state’s assumed administrative share. "The largest one is accounting for the fact that the… HR 1 requires states to pay 75% of the food assistance or SNAP admin cost," he told the committee, and HFA included a roughly $94.3 million general-fund estimate for that change. Khoskra said additional HR1-related effects include increased redetermination frequency (every six months instead of annually) and new work‑tracking obligations that HFA estimates would require hundreds of additional caseworkers statewide.

HFA told the committee the executive recommendation requests several hundred new FTEs for HHS operations (589 FTEs tied to HR1 implementation at local offices and 323 FTEs for the new psychiatric hospital, among others), and that average salary figures in the presentation were illustrative. Committee members repeatedly asked for more detail; Khoskra said HFA would provide additional cost and implementation detail, and that some federal decisions expected in June would shape final state costs.

Representative Longjohn asked whether the 600 FTEs HFA cited are local and state employees tasked with monitoring reported hours and eligibility; Khoskra confirmed redetermination frequency and additional casework are the basis for the request but said the numbers are HFA estimates and remain subject to refinement.

HFA emphasized that entitlement payments would continue to flow to recipients; the fiscal pressure is on the state’s share of administrative and some program costs. The committee requested more granular estimates, which HFA committed to provide in follow-up documents.