RALEIGH The state Department of Health and Human Services has been working for months to save money on Medicaid, but is missing important milestones crucial to reaching goals mandated by legislative budget cuts.

Rep. Nelson Dollar, a Cary Republican who helped write the Medicaid budget, blamed the federal government for the delay, saying it was hampering state efforts to save money.

Legislators had wanted $350 million in Medicaid savings, and put a varied menu of provider rate cuts and health service reductions into the budget to reach that amount.

But significant changes to the health services the state offers or how much it pays doctors, hospitals and other health care specialists requires federal approval. That's because the federal government pays most of the bill for the health insurance program for 1.5 million poor, disabled and elderly state residents. The state's Medicaid budget is $12.8 billion this year, with the state paying about $3 billion.

The state Medicaid office asked federal permission for 47 changes that the budget anticipated having in place Oct. 1, said Lanier Cansler, state Department of Health and Human Services secretary. So far, the state has gotten approval for only one of those changes.

"I'm running out of time to do whatever we're going to do," Cansler told a Medicaid advisory group late last week. The Medical Care Advisory Committee is suggesting ways the department might come up with as much as $118 million in additional budget cuts to compensate, in part, for the federal approval lag time.

Though the details aren't set, meeting Medicaid budget targets likely will mean another round of rate cuts for some health care providers and more limits on medical services for patients.

There are other challenges to staying within the budget.

The legislature included in its plan $90 million in Medicaid savings from the health management network called Community Care North Carolina. Cansler said last summer that the department would need to know by October if Community Care was on track to save that much. If Community Care falls short, he is to cut more medical services or provider rates to hit the savings target.

But no one knows how much Community Care is on track to save this year.

The savings strategy depended on enrolling 170,000 elderly, blind and disabled Medicaid recipients into Community Care, where patients work with doctors and care coordinators with the aim of avoiding unnecessary tests and getting timely care before illnesses require expensive hospital treatment.

Cansler said enrollment did not grow as quickly as he would have liked in July and August, but a September expense report showed that Community Care was controlling costs.

Dollar, the Cary Republican, said he was confident Community Care would save $90 million this year.

Dollar put the onus on Gov. Bev Perdue to convince the Obama administration to speed up approval of the changes the state wants.

In a prepared statement, Perdue spokeswoman Chris Mackey said Perdue and Cansler have spoken with federal officials about getting the approvals, but North Carolina is waiting along with every other state.

Perdue's office also pointed out that the governor had warned legislators that federal approval would take time, but they opted to push an unrealistic budget.