Setting a roughly $6 billion state budget, as always will be the overarching issue for the legislative session. And, as in most years, funding roughly $2.5 billion in education spending and nearly $1 billion for Medicaid will be the overarching fiscal issues.

Frierson and (Senate Chairman Buck) Clarke said a potential $100 million shortfall for Medicaid for the current year has garnered little public attention, but could have a drastic effect on the budget and other agencies, even in a year with the economy and state revenue improving.

Medicaid spending is a moving target. The number of people served and amount of care they need fluctuates. The agency has in the past warned of large deficits that didn’t happen. But both Clarke and Frierson said the pending $100 million shortfall is looking more solid.

“Education is always the first thing everybody talks about increased funding for,” Clarke said. “But with a $100 million deficit for Medicaid, and them projecting they will need another $20 million on top of that next year, that’s $120 million we have to come up with for next year’s budget. With a $160 million to $180 million revenue increase, Medicaid would just about wipe that out.”

Frierson said the federal Affordable Care Act has added about 75,000 more people to Medicaid through “the wood-work effect.” That is people who in the past qualified for Medicaid, but didn’t know they qualified or apply for it until they applied for the ACA and were directed to Medicaid.

“Medicaid is continuing to suck up large sums of recurring cash,” Frierson said. “… I’m about ready to punt with the Medicaid program.”

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