Relates to the maintenance appropriations to the Department of Health and Welfare and the State Independent Living Council for fiscal year 2027.

LEGISLATURE OF THE STATE OF IDAHO Sixty-eighth Legislature Second Regular Session - 2026 IN THE SENATE SENATE BILL NO. 1435 BY FINANCE COMMITTEE AN ACT1 RELATING TO THE APPROPRIATION TO HEALTH AND HUMAN SERVICES; APPROPRIATING2 MONEYS TO THE DEPARTMENT OF HEALTH AND WELFARE FOR THE DIVISIONS OF3 YOUTH SAFETY AND PERMANENCY, EARLY LEARNING AND DEVELOPMENT, FAMILY AND4 COMMUNITY PARTNERSHIPS, WELFARE, MEDICAID, PUBLIC HEALTH SERVICES, IN-5 DIRECT SUPPORT SERVICES, LICENSING AND CERTIFICATION, SUBSTANCE ABUSE6 TREATMENT AND PREVENTION, MENTAL HEALTH SERVICES, PSYCHIATRIC HOS-7 PITALIZATION, AND INDEPENDENT COUNCILS, AND TO THE STATE INDEPENDENT8 LIVING COUNCIL FOR FISCAL YEAR 2027; LIMITING THE NUMBER OF AUTHORIZED9 FULL-TIME EQUIVALENT POSITIONS; PROVIDING FOR GENERAL FUND TRANSFERS10 TO THE COOPERATIVE WELFARE FUND; DIRECTING EXPENDITURES FOR TRUSTEE AND11 BENEFIT PAYMENTS; PROVIDING REQUIREMENTS FOR PROGRAM INTEGRITY; CLARI-12 FYING THE RESPONSIBILITY FOR THE EDUCATIONAL NEEDS OF CERTAIN CHILDREN13 IN STATE CARE; DIRECTING THE USE OF CHILD ABUSE PROTECTION AND TREATMENT14 ACT FUNDS; REQUIRING A MONTHLY MEDICAID TRACKING REPORT; ALLOWING FOR15 TRANSFER OF APPROPRIATIONS BETWEEN MEDICAID PROGRAMS; REQUIRING A RE-16 PORT ON MEDICAID MANAGED CARE IMPLEMENTATION; REQUIRING COST-SHARING17 FOR SERVICES; APPROPRIATING AND TRANSFERRING MONEYS FROM THE COOPER-18 ATIVE WELFARE (GENERAL) FUND TO THE RURAL PHYSICIAN INCENTIVE FUND;19 PROVIDING REQUIREMENTS FOR BUDGET INTEGRITY FOR MEDICAID; ALLOCAT-20 ING FUNDING FOR SMOKING CESSATION; DIRECTING EXPENDITURES FOR PROJECT21 FILTER; REQUIRING REPORTS ON FACILITY LICENSING AND CERTIFICATIONS;22 LIMITING THE TRANSFER OF LEGISLATIVE APPROPRIATIONS BETWEEN MENTAL23 HEALTH SERVICES AND PSYCHIATRIC HOSPITALIZATION; REQUIRING REPORTS24 REGARDING FUNDING FOR BEHAVIORAL HEALTH COMMUNITY CRISIS CENTERS; DI-25 RECTING THE USE OF THE STATE OPIOID RESPONSE GRANT; DIRECTING USES OF26 THE IDAHO MILLENNIUM INCOME FUND; PROVIDING FOR IDAHO DRUG FREE YOUTH27 OVERSIGHT; PROVIDING EXEMPTIONS FROM PROGRAM TRANSFER LIMITATIONS FOR28 THE COMMUNITY HOSPITALIZATION PROGRAM; DIRECTING ACQUISITIONS; RE-29 QUIRING A REPORT ON RULES; AMENDING SECTION 56-2204, IDAHO CODE, TO30 REVISE PROVISIONS REGARDING LEGISLATIVE APPROVAL FOR COMPREHENSIVE31 MEDICAID MANAGED CARE; PROVIDING FOR ACCOUNTABILITY REPORTS; PROVIDING32 FOR CONDITIONS, LIMITATIONS, AND RESTRICTIONS; AND DECLARING AN EMER-33 GENCY AND PROVIDING EFFECTIVE DATES.34

Be It Enacted by the Legislature of the State of Idaho:35

SECTION 1. There is hereby appropriated to Health and Human Services36 the following amounts to be expended according to the designated programs37 and expense classes from the listed funds for the period July 1, 2026,38 through June 30, 2027:39

2 FOR1 FOR2 FOR TRUSTEE AND PERSONNEL3 OPERATING BENEFIT COSTS4 EXPENDITURES PAYMENTS TOTAL (1) DEPARTMENT OF HEALTH AND WELFARE:5 I. YOUTH SAFETY & PERMANENCY:6 A. YOUTH SAFETY & PERMANENCY:7 FROM:8 Cooperative Welfare (General)9 Fund10 $18,538,400 $4,677,100 $23,215,500 Cooperative Welfare (Dedicated)11 Fund12 76,500 20,000 96,500 Cooperative Welfare (Federal)13 Fund14 30,851,600 5,928,500 36,780,100 TOTAL15 $49,466,500 $10,625,600 $60,092,100 B. FOSTER & ASSISTANCE PAYMENTS:16 FROM:17 Cooperative Welfare (General)18 Fund19 $29,996,300 $29,996,300 Cooperative Welfare (Dedicated)20 Fund21 150,000 150,000 Cooperative Welfare (Federal)22 Fund23 31,306,700 31,306,700 TOTAL24 $61,453,000 $61,453,000 DIVISION TOTAL25 $49,466,500 $10,625,600 $61,453,000 $121,545,100 II. EARLY LEARNING & DEVELOPMENT:26 A. EARLY LEARNING AND DEVELOPMENT:27 FROM:28 Cooperative Welfare (General)29 Fund30 $8,453,200 $1,505,600 $2,860,200 $12,819,000 Cooperative Welfare (Dedicated)31 Fund32 131,100 46,300 783,100 960,500 Cooperative Welfare (Federal)33 Fund34 6,009,600 1,860,500 2,853,500 10,723,600 TOTAL35 $14,593,900 $3,412,400 $6,496,800 $24,503,100

3 FOR1 FOR2 FOR TRUSTEE AND PERSONNEL3 OPERATING BENEFIT COSTS4 EXPENDITURES PAYMENTS TOTAL B. IDAHO CHILD CARE PROGRAM:5 FROM:6 Cooperative Welfare (General)7 Fund8 $24,800 $1,175,000 $1,199,800 Cooperative Welfare (Federal)9 Fund10 676,100 $1,604,600 60,784,400 63,065,100 TOTAL11 $700,900 $1,604,600 $61,959,400 $64,264,900 C. SOUTHWEST IDAHO TREATMENT CENTER:12 FROM:13 Cooperative Welfare (General)14 Fund15 $5,967,300 $439,300 $91,300 $6,497,900 Cooperative Welfare (Dedicated)16 Fund17 345,500 137,800 10,600 493,900 Cooperative Welfare (Federal)18 Fund19 4,393,300 1,562,500 147,200 6,103,000 TOTAL20 $10,706,100 $2,139,600 $249,100 $13,094,800 DIVISION TOTAL21 $26,000,900 $7,156,600 $68,705,300 $101,862,800 III. FAMILY AND COMMUNITY PARTNERSHIPS:22 FROM:23 Cooperative Welfare (General)24 Fund25 $430,200 $133,400 $450,000 $1,013,600 Cooperative Welfare (Dedicated)26 Fund27 19,500 50,000 69,500 Cooperative Welfare (Federal)28 Fund29 3,005,000 270,900 2,900,000 6,175,900 TOTAL30 $3,435,200 $423,800 $3,400,000 $7,259,000 IV. DIVISION OF WELFARE:31 A. SELF-RELIANCE OPERATIONS:32 FROM:33 Cooperative Welfare (General)34 Fund35 $19,674,300 $5,565,000 $25,239,300

4 FOR1 FOR2 FOR TRUSTEE AND PERSONNEL3 OPERATING BENEFIT COSTS4 EXPENDITURES PAYMENTS TOTAL Cooperative Welfare (Dedicated)5 Fund6 862,100 3,539,000 4,401,100 Cooperative Welfare (Federal)7 Fund8 32,918,900 17,333,000 50,251,900 TOTAL9 $53,455,300 $26,437,000 $79,892,300 B. BENEFIT PAYMENTS:10 FROM:11 Cooperative Welfare (General)12 Fund13 $19,630,600 $19,630,600 Cooperative Welfare (Dedicated)14 Fund15 500,000 500,000 Cooperative Welfare (Federal)16 Fund17 32,318,800 32,318,800 TOTAL18 $52,449,400 $52,449,400 DIVISION TOTAL19 $53,455,300 $26,437,000 $52,449,400 $132,341,700 V. DIVISION OF MEDICAID:20 A. MEDICAID ADMINISTRATION AND MEDICAL MGMT:21 FROM:22 Cooperative Welfare (General)23 Fund24 $13,184,000 $15,080,400 $5,205,700 $33,470,100 Medicaid Management Information Systems Dedicated25 Fund26 82,900 82,900 Cooperative Welfare (Dedicated)27 Fund28 461,600 8,883,800 9,345,400 Idaho Millennium Income29 Fund30 108,400 142,300 250,700 Cooperative Welfare (Federal)31 Fund32 18,710,400 38,008,800 19,518,700 76,237,900 TOTAL33 $32,547,300 $62,115,300 $24,724,400 $119,387,000

5 FOR1 FOR2 FOR TRUSTEE AND PERSONNEL3 OPERATING BENEFIT COSTS4 EXPENDITURES PAYMENTS TOTAL B. COORDINATED MEDICAID PLAN:5 FROM:6 Cooperative Welfare (General)7 Fund8 $324,757,700 $324,757,700 Hospital Assessment9 Fund10 103,577,700 103,577,700 Cooperative Welfare (Dedicated)11 Fund12 1,445,100 1,445,100 Cooperative Welfare (Federal)13 Fund14 853,459,000 853,459,000 TOTAL15 $1,283,239,500 $1,283,239,500 C. ENHANCED MEDICAID PLAN:16 FROM:17 Cooperative Welfare (General)18 Fund19 $295,849,300 $295,849,300 Hospital Assessment20 Fund21 4,172,700 4,172,700 Cooperative Welfare (Dedicated)22 Fund23 347,297,000 347,297,000 Cooperative Welfare (Federal)24 Fund25 708,044,400 708,044,400 TOTAL26 $1,355,363,400 $1,355,363,400 D. BASIC MEDICAID PLAN:27 FROM:28 Cooperative Welfare (General)29 Fund30 $202,906,400 $202,906,400 Hospital Assessment31 Fund32 115,270,400 115,270,400 Cooperative Welfare (Dedicated)33 Fund34 1,023,000 1,023,000 Cooperative Welfare (Federal)35 Fund36 582,661,100 582,661,100 TOTAL37 $901,860,900 $901,860,900

6 FOR1 FOR2 FOR TRUSTEE AND PERSONNEL3 OPERATING BENEFIT COSTS4 EXPENDITURES PAYMENTS TOTAL E. EXPANSION MEDICAID PLAN:5 FROM:6 Cooperative Welfare (General)7 Fund8 $89,470,200 $89,470,200 Hospital Assessment9 Fund10 25,064,800 25,064,800 Cooperative Welfare (Dedicated)11 Fund12 196,248,900 196,248,900 Cooperative Welfare (Federal)13 Fund14 1,010,215,500 1,010,215,500 TOTAL15 $1,320,999,400 $1,320,999,400 F. EXTENDED EMPLOYMENT SERVICES:16 FROM:17 Cooperative Welfare (General)18 Fund19 $299,900 $91,700 $2,969,800 $3,361,400 DIVISION TOTAL20 $32,847,200 $62,207,000 $4,889,157,400 $4,984,211,600 VI. PUBLIC HEALTH SERVICES:21 A. PHYSICAL HEALTH SERVICES:22 FROM:23 Cooperative Welfare (General)24 Fund25 $2,309,000 $969,700 $1,678,900 $4,957,600 Cancer Control26 Fund27 76,000 205,000 82,600 363,600 Central Tumor Registry28 Fund29 360,000 360,000 Rural Nursing Loan Repayment30 Fund31 875,000 875,000 Cooperative Welfare (Dedicated)32 Fund33 3,176,900 5,712,700 12,386,200 21,275,800 Idaho Millennium Income34 Fund35 2,406,000 2,100,000 4,506,000

7 FOR1 FOR2 FOR TRUSTEE AND PERSONNEL3 OPERATING BENEFIT COSTS4 EXPENDITURES PAYMENTS TOTAL Cooperative Welfare (Federal)5 Fund6 11,230,500 17,967,500 35,005,100 64,203,100 TOTAL7 $16,792,400 $27,620,900 $52,127,800 $96,541,100 B. LABORATORY SERVICES:8 FROM:9 Cooperative Welfare (General)10 Fund11 $2,369,900 $716,000 $3,085,900 Cooperative Welfare (Dedicated)12 Fund13 498,400 273,800 772,200 Cooperative Welfare (Federal)14 Fund15 1,352,600 939,300 2,291,900 TOTAL16 $4,220,900 $1,929,100 $6,150,000 C. SUICIDE PREVENTION AND AWARENESS:17 FROM:18 Cooperative Welfare (General)19 Fund20 $361,200 $316,600 $1,129,400 $1,807,200 Cooperative Welfare (Federal)21 Fund22 0 115,000 80,000 195,000 TOTAL23 $361,200 $431,600 $1,209,400 $2,002,200 D. HEALTH CARE POLICY INITIATIVES:24 FROM:25 Cooperative Welfare (General)26 Fund27 $117,500 $32,700 $142,000 $292,200 Cooperative Welfare (Dedicated)28 Fund29 81,400 75,000 156,400 Cooperative Welfare (Federal)30 Fund31 119,200 33,000 356,300 508,500 TOTAL32 $318,100 $140,700 $498,300 $957,100 DIVISION TOTAL33 $21,692,600 $30,122,300 $53,835,500 $105,650,400

8 FOR1 FOR2 FOR TRUSTEE AND PERSONNEL3 OPERATING BENEFIT COSTS4 EXPENDITURES PAYMENTS TOTAL VII. INDIRECT SUPPORT SERVICES:5 FROM:6 Cooperative Welfare (General)7 Fund8 $12,185,100 $8,525,700 $20,710,800 Cooperative Welfare (Dedicated)9 Fund10 1,626,200 1,502,100 3,128,300 Cooperative Welfare (Federal)11 Fund12 14,142,500 9,780,300 23,922,800 TOTAL13 $27,953,800 $19,808,100 $47,761,900 VIII. LICENSING AND CERTIFICATION:14 FROM:15 Cooperative Welfare (General)16 Fund17 $2,084,900 $251,400 $2,336,300 Cooperative Welfare (Dedicated)18 Fund19 1,037,300 12,200 1,049,500 Cooperative Welfare (Federal)20 Fund21 4,791,100 639,600 5,430,700 TOTAL22 $7,913,300 $903,200 $8,816,500 IX. SUBSTANCE ABUSE TREATMENT & PREVENTION:23 FROM:24 Prevention of Minors' Access to Tobacco25 Fund26 $21,800 $21,800 Cooperative Welfare (Dedicated)27 Fund28 $7,000 438,300 445,300 Liquor Control29 Fund30 533,900 $116,100 650,000 Idaho Millennium Income31 Fund32 320,000 1,600,000 1,920,000 Cooperative Welfare (Federal)33 Fund34 761,800 3,460,200 19,302,300 23,524,300 TOTAL35 $1,302,700 $4,240,300 $21,018,400 $26,561,400

9 FOR1 FOR2 FOR TRUSTEE AND PERSONNEL3 OPERATING BENEFIT COSTS4 EXPENDITURES PAYMENTS TOTAL X. MENTAL HEALTH SERVICES:5 A. CHILDREN'S MENTAL HEALTH:6 FROM:7 Cooperative Welfare (General)8 Fund9 $3,759,200 $2,715,000 $1,550,400 $8,024,600 Cooperative Welfare (Federal)10 Fund11 2,661,600 1,904,400 1,812,600 6,378,600 TOTAL12 $6,420,800 $4,619,400 $3,363,000 $14,403,200 B. ADULT MENTAL HEALTH:13 FROM:14 Cooperative Welfare (General)15 Fund16 $13,510,300 $4,249,600 $7,960,700 $25,720,600 Cooperative Welfare (Federal)17 Fund18 1,085,700 1,165,300 778,700 3,029,700 TOTAL19 $14,596,000 $5,414,900 $8,739,400 $28,750,300 DIVISION TOTAL20 $21,016,800 $10,034,300 $12,102,400 $43,153,500 XI. PSYCHIATRIC HOSPITALIZATION:21 A. COMMUNITY HOSPITALIZATION:22 FROM:23 Cooperative Welfare (General)24 Fund25 $534,800 $4,249,900 $4,784,700 B. STATE HOSPITAL NORTH:26 FROM:27 Cooperative Welfare (General)28 Fund29 $9,415,100 $852,900 $45,600 $10,313,600 Cooperative Welfare (Dedicated)30 Fund31 2,579,000 382,200 2,961,200 State Hospital North Endowment Income32 Fund33 652,800 1,192,600 104,400 1,949,800 Cooperative Welfare (Federal)34 Fund35 1,709,300 0 0 1,709,300 TOTAL36 $14,356,200 $2,427,700 $150,000 $16,933,900

10 FOR1 FOR2 FOR TRUSTEE AND PERSONNEL3 OPERATING BENEFIT COSTS4 EXPENDITURES PAYMENTS TOTAL C. STATE HOSPITAL SOUTH:5 FROM:6 Cooperative Welfare (General)7 Fund8 $6,678,900 $225,200 $5,300 $6,909,400 Cooperative Welfare (Dedicated)9 Fund10 13,774,200 3,339,100 900 17,114,200 Mental Hospital Endowment Income11 Fund12 5,446,400 2,208,700 284,700 7,939,800 Cooperative Welfare (Federal)13 Fund14 5,586,500 893,100 20,300 6,499,900 TOTAL15 $31,486,000 $6,666,100 $311,200 $38,463,300 D. STATE HOSPITAL WEST:16 FROM:17 Cooperative Welfare (General)18 Fund19 $1,694,100 $468,700 $8,300 $2,171,100 Cooperative Welfare (Dedicated)20 Fund21 4,154,400 1,783,800 5,938,200 Cooperative Welfare (Federal)22 Fund23 4,400 0 0 4,400 TOTAL24 $5,852,900 $2,252,500 $8,300 $8,113,700 DIVISION TOTAL25 $51,695,100 $11,881,100 $4,719,400 $68,295,600 XII. INDEPENDENT COUNCILS:26 A. DEVELOPMENTAL DISABILITIES COUNCIL:27 FROM:28 Cooperative Welfare (General)29 Fund30 $205,800 $20,100 $225,900 Cooperative Welfare (Dedicated)31 Fund32 15,000 15,000 Cooperative Welfare (Federal)33 Fund34 497,200 275,900 $31,600 804,700 TOTAL35 $703,000 $311,000 $31,600 $1,045,600

11 FOR1 FOR2 FOR TRUSTEE AND PERSONNEL3 OPERATING BENEFIT COSTS4 EXPENDITURES PAYMENTS TOTAL B. DOMESTIC VIOLENCE COUNCIL:5 FROM:6 Cooperative Welfare (General)7 Fund8 $198,300 $79,200 $277,500 Domestic Violence Project9 Fund10 219,500 164,600 $171,800 555,900 Cooperative Welfare (Dedicated)11 Fund12 40,000 40,000 Cooperative Welfare (Federal)13 Fund14 318,300 269,200 12,515,400 13,102,900 TOTAL15 $736,100 $553,000 $12,687,200 $13,976,300 DIVISION TOTAL16 $1,439,100 $864,000 $12,718,800 $15,021,900 (2) STATE INDEPENDENT LIVING COUNCIL:17 FROM:18 General19 Fund20 $173,700 $109,900 $283,600 State Independent Living Council (Ded)21 Fund22 312,200 94,800 407,000 TOTAL23 $485,900 $204,700 $690,600 GRAND TOTAL24 $298,704,400 $184,908,000 $5,179,559,600 $5,663,172,000

SECTION 2. FTP AUTHORIZATION. In accordance with Section 67-3519,25 Idaho Code, each of the programs in Health and Human Services listed below26 is authorized no more than the following number of full-time equivalent po-27 sitions at any point during the period July 1, 2026, through June 30, 2027,28 unless specifically authorized by the Governor. The Joint Finance-Appro-29 priations Committee will be notified promptly of any increased positions so30 authorized.31 Youth Safety and Permanency ..................................500.5332 Early Learning and Development ...............................142.8333 Idaho Child Care Program .......................................5.5034 Southwest Idaho Treatment Center .............................111.0035 Family and Community Partnerships .............................38.5536 Division of Welfare ..........................................609.5037 Division of Medicaid .........................................303.5038

12 Public Health Services .......................................214.221 Indirect Support Services ....................................244.752 Licensing and Certification ...................................70.003 Substance Abuse Treatment and Prevention .......................12.004 Children's Mental Health ......................................53.805 Adult Mental Health ..........................................132.006 State Hospital North .........................................137.197 State Hospital South .........................................300.418 State Hospital West ...........................................53.999 Developmental Disabilities Council .............................6.0010 Domestic Violence Council ......................................5.0011 State Independent Living Council ...............................4.0012

SECTION 3. GENERAL FUND TRANSFERS. As appropriated, the Office of the13 State Controller shall periodically make transfers from the General Fund to14 the Cooperative Welfare Fund as requested by the director of the Department15 of Health and Welfare and approved by the Board of Examiners.16

SECTION 4. TRUSTEE AND BENEFIT PAYMENTS. Notwithstanding the provi-17 sions of Section 67-3511, Idaho Code, funds appropriated in Section 1 of this18 act in the trustee and benefit payments expense class shall not be trans-19 ferred to any other expense classes for the period July 1, 2026, through June20 30, 2027.21

SECTION 5. PROGRAM INTEGRITY. Notwithstanding any other provision of22 law to the contrary, the Department of Health and Welfare shall be required23 to provide those services authorized or mandated by law in each program, only24 to the extent of funding and available resources appropriated for each bud-25 geted program.26

SECTION 6. EDUCATIONAL NEEDS. The Department of Health and Welfare27 shall be responsible for the educational needs of school-age children placed28 in its custody by the judicial branch for either child protective issues or29 mental health issues. If the department places a child in a licensed resi-30 dential treatment facility that includes a nonpublic accredited school and31 it is determined by the department that it is in the best interests of the32 child to be educated at the residential treatment facility, then it is the33 responsibility of the department to pay for such education per student, per34 educational day. Other Idaho state agencies shall not be precluded from35 exercising their responsibility to ensure a free and appropriate education36 for these students within the requirements of federal disability law. The37 fiscal impact of this section is included within existing department base38 appropriations.39

SECTION 7. CHILD ABUSE PROTECTION AND TREATMENT ACT FUNDS. Of the40 amount appropriated in Section 1 of this act from the Cooperative Welfare41 (Federal) Fund, a minimum of $42,000 of federal Child Abuse Protection and42 Treatment Act funds appropriated to the Department of Health and Welfare43 shall be provided to the public health districts each year. Funds for each44 public health district shall be distributed at one-seventh (1/7) of the45

13 total amount, which shall be used for the citizen review panels pursuant to1 Section 16-1647, Idaho Code.2

SECTION 8. MEDICAID TRACKING REPORT. The Department of Health and Wel-3 fare's Division of Medicaid and Division of Indirect Support Services shall4 deliver a report that compares the Medicaid appropriation, distributed by5 month for the year, to the actual expenditures and remaining forecasted ex-6 penditures for the year on a monthly basis to the Legislative Services Office7 and the Division of Financial Management. The report shall also include a8 forecast, updated monthly, of the next fiscal year's anticipated trustee and9 benefit expenditures. The format of the report and the information included10 therein shall be determined by the Legislative Services Office and the Divi-11 sion of Financial Management.12

SECTION 9. TRANSFER OF APPROPRIATIONS. Notwithstanding the provisions13 of Section 67-3511, Idaho Code, funding provided for the trustee and bene-14 fit payments expense class in the Department of Health and Welfare's Divi-15 sion of Medicaid may be transferred in excess of ten percent (10%) among the16 Coordinated Medicaid Plan, Enhanced Medicaid Plan, Basic Medicaid Plan, Ex-17 pansion Medicaid Plan, and Medicaid Administration and Medical Management18 Programs, but shall not be transferred to any other budgeted program or ex-19 pense class within the Department of Health and Welfare for the period July20 1, 2026, through June 30, 2027.21

SECTION 10. MEDICAID MANAGED CARE IMPLEMENTATION. The Department of22 Health and Welfare's Division of Medicaid shall provide a report to the23 Legislative Services Office and the Division of Financial Management on24 progress in integrating managed care approaches into the state Medicaid25 system. The format of the report and information contained therein shall be26 determined by the Legislative Services Office and the Division of Financial27 Management. The report shall be submitted no later than December 1, 2026.28

SECTION 11. COST-SHARING REQUIREMENT. The Department of Health and29 Welfare shall implement cost-sharing in the Division of Medicaid, as re-30 quired by Section 56-257, Idaho Code, to the maximum extent that is federally31 allowable for the expanded population of children whose families' gross32 taxable income exceeds one hundred eighty-five percent (185%) but does not33 exceed three hundred percent (300%) of the federal poverty limit, for Medic-34 aid-eligible services as identified in House Bill No. 43, as enacted by the35 First Regular Session of the Sixty-fourth Idaho Legislature.36

SECTION 12. CASH TRANSFER. Of the amount appropriated in Section 1 of37 this act from the Cooperative Welfare (General) Fund, there is hereby appro-38 priated and the Office of the State Controller shall transfer $640,000 from39 the Cooperative Welfare (General) Fund to the Rural Physician Incentive Fund40 on July 1, 2026, or as soon thereafter as practicable, for the Department of41 Health and Welfare for the period July 1, 2026, through June 30, 2027.42

SECTION 13. BUDGET INTEGRITY. Notwithstanding any other provision of43 law to the contrary, and consistent with its cost containment strategy,44

14 the Department of Health and Welfare's Division of Medicaid shall submit1 its budget request in accordance with applicable Idaho law as of the date2 of submission. This section does not prohibit the agency or Governor from3 making requests of the Legislature that would impact any portion of the4 department's budget. However, any proposed changes to Idaho Code with an5 anticipated budgetary impact shall be identified in the agency budget re-6 quest and Governor's budget recommendation in narrative form only, without7 numerical entries. Further, the department shall submit its budget request8 based on the forecasted amount for the most recent month available from the9 report identified in Section 8 of this act and for the estimated needs of10 maintaining operations of the division.11

SECTION 14. SMOKING CESSATION. Of the amount appropriated in Section 112 of this act, $2,100,000 from the Idaho Millennium Income Fund shall be dis-13 tributed to the public health districts for the purpose of prevention and14 cessation programs for tobacco, vape, and other substances as funds allow.15 These moneys shall be distributed to each district based on the approved for-16 mula of the board of trustees of the Idaho district boards of health as pro-17 vided in Section 39-411(6), Idaho Code.18

SECTION 15. PROJECT FILTER ALLOWABLE USES. Of the amount appropriated19 in Section 1 of this act, $2,406,000 from the Idaho Millennium Income Fund20 shall be expended for the purpose of prevention and cessation programs from21 tobacco, vape, and other substances as funds allow. No moneys for Project22 Filter from the Idaho Millennium Income Fund shall be used for sponsorships23 or passive advertising.24

SECTION 16. REPORTS ON FACILITY LICENSING AND CERTIFICATIONS. The De-25 partment of Health and Welfare's Licensing and Certification Program shall26 provide biannual reports to the Legislative Services Office Budget and Pol-27 icy Analysis Division and the Division of Financial Management on the sta-28 tus of facility licensing and certifications as well as staff workload and29 caseload issues. The format of the report and the type of information in-30 cluded therein shall be determined by the Legislative Services Office and31 the Division of Financial Management. The first report shall be submitted32 no later than December 31, 2026, and the second report shall be submitted no33 later than June 30, 2027.34

SECTION 17. LIMITING TRANSFER OF LEGISLATIVE APPROPRIATIONS. Notwith-35 standing the provisions of Section 67-3511, Idaho Code, moneys appropriated36 from the Cooperative Welfare (General) Fund to the Department of Health and37 Welfare's Divisions of Mental Health Services and Psychiatric Hospitaliza-38 tion may be transferred between divisions but shall not be transferred to any39 other division or program within the Department of Health and Welfare with-40 out legislative approval.41

SECTION 18. BEHAVIORAL HEALTH COMMUNITY CRISIS CENTERS. The seven be-42 havioral health community crisis centers shall submit a report that indi-43 cates the levels of funding support by fund source. The format of the report44 and the information included therein shall be determined by the Legislative45

15 Services Office Budget and Policy Analysis Division. The contents of these1 reports shall aid in providing a clearer understanding of the financial sit-2 uations of the behavioral health community crisis centers. These reports3 shall be submitted by the Department of Health and Welfare to the Legislative4 Services Office Budget and Policy Analysis Division no later than December5 31, 2026.6

SECTION 19. STATE OPIOID RESPONSE GRANT. Funds available for naloxone7 shall be available only to first responders for distribution in the state of8 Idaho.9

SECTION 20. IDAHO MILLENNIUM INCOME FUND. Of the funds appropriated10 from the Idaho Millennium Income Fund in Section 1 of this act, $250,00011 shall be used by Idaho Drug Free Youth to support its various programs,12 including its annual youth summit, program chapters, and drug free school13 coordinators. Idaho Drug Free Youth shall provide to the Department of14 Health and Welfare a document that demonstrates operational and fiscal ac-15 countability for the supported programs. Idaho Drug Free Youth shall work16 collaboratively with the Department of Health and Welfare and shall sign an17 attestation letter or equivalent document that ensures funds will be used in18 accordance with this section, in accordance with Section 21 of this act, and19 in accordance with any other applicable rule or law and accounted for using20 generally accepted accounting principles.21

SECTION 21. IDAHO DRUG FREE YOUTH OVERSIGHT. (1) The Department of22 Health and Welfare shall provide oversight for the funds provided in Section23 20 of this act for Idaho Drug Free Youth. The Department of Health and Wel-24 fare shall:25 (a) Provide four distributions of $62,500 for a total distribution of26 $250,000. Distributions shall occur no later than July 15, 2026, Octo-27 ber 15, 2026, January 15, 2027, and April 15, 2027;28 (b) Receive and compile two reports from Idaho Drug Free Youth and29 transmit each report to the Legislative Services Office Budget and Pol-30 icy Analysis Division on behalf of the Joint Millennium Fund Committee31 by December 30, 2026, and by June 30, 2027, or as soon thereafter as is32 practicable. The format of the report and the content therein shall be33 determined by the Legislative Services Office Budget and Policy Analy-34 sis Division;35 (c) Withhold or recover distributions pursuant to paragraph (a) of this36 subsection if Idaho Drug Free Youth is not operating or has indicated it37 intends to no longer operate prior to the close of the fiscal year, if it38 does not provide any of the required reports, or otherwise as needed to39 address legal or fiscal concerns regarding funds provided to Idaho Drug40 Free Youth; and41 (d) Assist Idaho Drug Free Youth, as needed, to ensure services are be-42 ing provided as intended by this act and to meet the needs of program43 participants.44 (2) The Department of Health and Welfare shall not have the authority to45 directly manage Idaho Drug Free Youth or direct Idaho Drug Free Youth to per-46 form functions not required by this section or Section 20 of this act. The47

16 Department of Health and Welfare shall assist Idaho Drug Free Youth to ensure1 funds are used in accordance with this act. If the Department of Health and2 Welfare has reason to believe funds are misused in violation of this section3 or Section 20 of this act, or any rule or law, the Department of Health and4 Welfare may withhold funds until Idaho Drug Free Youth is in compliance with5 this act and applicable law. The Department of Health and Welfare shall im-6 mediately notify the Legislative Services Office Budget and Policy Analysis7 Division on behalf of the Joint Millennium Fund Committee of any misuse or8 perceived misuse of funds. The Department of Health and Welfare shall work9 collaboratively with Idaho Drug Free Youth to develop an appropriate correc-10 tive action plan.11

SECTION 22. EXEMPTIONS FROM PROGRAM TRANSFER LIMITATIONS. The Commu-12 nity Hospitalization Program is hereby exempted from the provisions of Sec-13 tion 67-3511(2), Idaho Code, allowing unlimited transfers into the Commu-14 nity Hospitalization Program from other programs within the Department of15 Health and Welfare for all moneys appropriated to it for the period July 1,16 2026, through June 30, 2027.17

SECTION 23. ACQUISITIONS. (1) Consistent with the provisions of Chap-18 ter 92, Title 67, Idaho Code, the Idaho Department of Health and Welfare is19 encouraged to engage in open, competitive acquisition processes. For all20 acquisitions during the period July 1, 2026, through June 30, 2027, for prop-21 erty, services, or settlement valued at more than $1,000,000, the Idaho De-22 partment of Health and Welfare shall make a report to the Joint Finance-Ap-23 propriations Committee when the acquisition process includes:24 (a) Any targeted requests for information or questions conveyed on be-25 half of external stakeholders by the Office of the Governor; or26 (b) Facilitation or coordination of meetings or communications with27 potential or actual bidders by the Office of the Governor.28 (2) Such report shall be made by the Idaho Department of Health and Wel-29 fare to the Joint Finance-Appropriations Committee and the Legislative Ser-30 vices Office Budget and Policy Analysis Division within 30 business days of31 such contact and include:32 (a) The nature and purpose for contact from the Office of the Governor;33 (b) The amount of the contract for property, services, or settlement34 subject to the acquisition process;35 (c) The duration of the contract for property, services, or settlement;36 (d) The parties involved;37 (e) The subject; and38 (f) Whether the acquisition was part of or awarded as a result of an39 open, competitive acquisition process or a sole source or other noncom-40 petitive procurement pursuant to Section 67-9221, Idaho Code.41

SECTION 24. REQUIRING A REPORT ON RULES. (1) The Department of Health42 and Welfare shall submit a report to the Joint Finance-Appropriations Com-43 mittee by December 31, 2026, identifying each rule section adopted pursuant44 to Section 56-202, Idaho Code.45 (2) For each rule section identified, the department shall specify how46 the rule section fulfills a duty outlined in Section 56-202, Idaho Code. In47

17 such cases where the department cannot explain how an identified rule sec-1 tion expressly fulfills a duty outlined in Section 56-202, Idaho Code, the2 department shall determine:3 (a) Steps to update the rule section to reflect the proper section of4 Idaho Code that provides authority to sustain the rule; or5 (b) Steps to repeal the rule section.6 (3) Where a rule section is identified as needing to be repealed, the7 department shall not expend any appropriation in the exercise of the rule.8 (4) The format and content of this report will be determined in consul-9 tation with the Budget and Policy Analysis Division of the Legislative Ser-10 vices Office.11

SECTION 25. That Section 56-2204, Idaho Code, be, and the same is hereby12 amended to read as follows:13 56-2204. LEGISLATIVE APPROVAL -- COMPREHENSIVE MEDICAID MANAGED14 CARE. (1) The department of health and welfare is authorized to and shall15 submit to the centers for medicare and medicaid services all state plan and16 waiver authorities required to implement a plan for comprehensive medicaid17 managed care.18 (2) The department of health and welfare shall:19 (a) Take such actions as are necessary to implement the provisions of20 this section;21 (b) Submit the application for federal approval of the state plan22 amendments and waivers required by this section no later than July 1,23 2026 2027;24 (c) Continue any existing managed care under the medicaid state plan25 and its waivers in effect at the time of the passage of this act until26 supplanted by the new comprehensive managed care plan required under27 this section;28 (d) Undertake cost containment strategies, such as bidding multi-year29 contracts with predetermined inflationary adjustments or withholding30 a percentage of capitation if managed care organizations do not meet31 these cost containment targets; and32 (e) Engage medicaid providers and participants in the substance and de-33 sign of a comprehensive managed care plan.34

SECTION 26. ACCOUNTABILITY REPORTS. Funds specifically identified in35 statute or in an appropriation act as intended for a certain purpose may36 be used only for that purpose. Funds provided in this act are subject to37 accountability reports and management reviews in accordance with Section38 67-702, Idaho Code, provided the Legislative Services Office auditor has39 sufficient resources to conduct those reports. State agencies that are40 authorized to contract for outside audits shall submit those reports to the41 Joint Finance-Appropriations Committee when those reports become avail-42 able.43

SECTION 27. CONDITIONS, LIMITATIONS, AND RESTRICTIONS. Appropriations44 made pursuant to this act are subject to the conditions, limitations, and re-45 strictions specified in this act.46

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SECTION 28. An emergency existing therefor, which emergency is hereby1 declared to exist, Section 25 of this act shall be in full force and effect on2 and after passage and approval, and Sections 1 through 24, 26, and 27 of this3 act this act shall be in full force and effect on and after July 1, 2026.4