The Michigan health department has saved $500,000 from its Medicare coverage of an estimated 1.3 million uninsured Michiganders, according to a report by the state’s auditor.
The savings come from eliminating the state health savings accounts (SSAs), which provide coverage for low-income individuals.
A spokeswoman for the auditor’s office said the savings come out of a $2.4 billion budget surplus the department created to deal with a state-wide funding shortfall of $2 billion in 2019.
The Michigan Health Department, which operates Medicaid and the Children’s Health Insurance Program, received $3.9 billion in state funds for fiscal year 2018.
The $500-million savings come as Medicaid has had a difficult time attracting new enrollees and funding its operating expenses.
The department said the budget shortfall could cause the agency to have to curtail or delay some of its operations in 2018.
“The financial impact on the budget is significant, and we have taken steps to reduce our spending and eliminate a large portion of the spending in 2018,” the spokesperson said in a statement.
The SSA savings come despite the fact that the department was required by the federal government to begin reducing the number of enrollees it covered by 2019.