State Budget Director Art Pope addressed the Senate Appropriations committee this morning under threat of subpoena. The issue addressed was Medicaid and the amount of funds the state budget should allocate towards this program. The Senate budget sets aside nearly $300 million more for Medicaid than the governor’s or the House’s budget. The state has experience significant Medicaid cost overruns in recent years. This morning Pope made his case why he and the state budget office believed the Senate’s Medicaid appropriation is too high.
Throughout the committee meeting members of the Senate and the Fiscal Research Division (FRD) remained skeptical. This uncertainty over numbers comes from two backlog issues. The first backlog concerns Medicaid applications that have yet, but will, be approved. The second backlog comes from hospitals and other medical providers. The main concern of the Senate on this matter is not putting forth enough money into the program, which would then lead to a shortage of funds.
Both sides of this issue – the FRD and the state budget office – made clear that they were convinced that their data on the matter was the most accurate. One point brought up by Pope concerning the Senate’s budget was the amount of cuts they have had to make elsewhere (especially in education) in order to make room for the large number of funds they have poured into Medicaid. Specifically, Pope brought up the large number of teacher assistants that would be laid off and the populations that would no longer be eligible for Medicaid in order to fund the Senate’s additional Medicaid allotment.
“Senator, what is the cost of over-funding Medicaid?” Pope asked. “The cost in the Senate budget is firing teacher assistants. Some 7,000 teaching assistants who serve over 239,000 children in classrooms would be fired. If you unnecessarily fire them, you can’t go back and rehire them an put them back in the classroom next spring.
“The Senate has to pay for its budget by changing the Medicaid eligibility laws,” he continued. “That will require … removing 5,200 aged, blind and disabled residents form the Medicaid safety net – 1,600 of those patients with Alzheimer’s or dementia currently being served in special care units.”
According to Pope, the worst that can happen if the Senate does not allocate enough funds is asking for more funds next year to cover the costs of Medicaid.
Overall, it seems there is still a long way to settling this matter. The General Assembly does not have long to continue mulling on the issue. The new fiscal year begins July 1. If a new budget is not passed, however, the state can operate on the second year of the biennial budget passed last year.