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HHS bill is DOA but hoping for CPR

Published (5/13/2010)
By Lauren Radomski
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Rep. Thomas Huntley and Sen. Linda Berglin listen to the side-by-side comparison of the House and Senate health and human services bills during a May 7 conference committee meeting. (Photo by Andrew VonBank)Gov. Tim Pawlenty and legislative leaders were expected to continue talks on the omnibus health and human services budget bill after the governor delivered an expected veto May 13.

Passed by the House and Senate May 12, HF2614*/ SF2337 would reduce General Fund health and human services expenditures by $114 million in the current biennium and by $155 million in the next biennium. Prior to the floor votes, Pawlenty said the legislation needed to do more to reduce spending.

“This bill doesn’t really go very far in that regard,” he reiterated at a Thursday press conference.

The governor and DFL leadership are also at odds over an early federal health care reform initiative that would draw down more than $1 billion in federal funding over the next three years with the help of a state match. Another sticking point: surcharges on hospitals, long-term care facilities and HMOs that would help capture the federal dollars.

A part of the Legislature’s budget-balancing solution, the bill is crucial to “leaving our books in the black,” said Sen. Linda Berglin (DFL-Mpls), who sponsors the legislation with Rep. Thomas Huntley (DFL-Duluth).

On Wednesday, Berglin said she and House leadership were intent on continuing negotiations with Pawlenty.

“I think it’s important for the governor to be working with us and not telling us every time we try to help out here that we’re a problem,” Berglin said.

As of Session Weekly press time, DFLers had not publicly discussed whether they would attempt a veto override.

Assessing federal reform

One of the bill’s key components is related to the federal health care reform law. It would have a major impact on low-income adults, the doctors who care for them and the state’s future health care spending.

Under the proposal, certain Minnesotans making less than $8,000 annually could enroll in the state’s Medicaid program as soon as next year. This would include childless adults enrolled in General Assistance Medical Care and MinnesotaCare, programs that are solely state-funded.

Supporters favor the change because the Medicaid program garners federal dollars, which will grow significantly in 2014. That’s when Medicaid will cover a broader range of adults across the country.

The proposal is favored by hospital officials because it would reimburse them for each GAMC patient that they treat, Berglin said. In contrast, the revised GAMC program offers hospitals low reimbursement for agreeing to treat an unknown number of patients.

Huntley said Minnesota would receive about $1.4 billion in federal funding over the next three years if the state embraces the Medicaid option. Legislators would fund a required state match with $188 million from the General Fund and about $1.2 billion that otherwise would have been spent on GAMC and MinnesotaCare.

Huntley called the Medicaid option something lawmakers can’t pass up.

“It’s $7.45 returned for every dollar that we spend in that program,” he said, “and where will that $1.4 billion go? It’s going to go to our health care providers, our hospitals, our physicians and our nurses who have been severely cut over the last three or four years.”

On the House floor, where the bill passed 82-50, Republicans argued the legislation would actually increase spending using money the state doesn’t have. Rep. Sarah Anderson (R-Plymouth) said the federal government has a poor track record of fulfilling its promises on transportation and special education funding. She’s concerned a future Congress may renege on the health care funding or determine the money simply isn’t available.

Legislators also disputed the extent of cuts in the bill, which some Republicans said are relatively small.

Under the bill, hospitals would sustain a nearly 2 percent rate cut in the out biennium. They, along with nursing facilities, would see a delay in the rebasing of their Medicaid reimbursement rates. Specialist physicians would have their rates cut and spending would be reduced in areas including mental health services, chemical dependency treatment and children’s protective services.

“At the end of those cuts are real people, people who are sick and they’re elderly and they’re disabled, and they’re going to experience this,” said Rep. Erin Murphy (DFL-St. Paul).

Rep. Jim Abeler (R-Anoka) said that while he sympathized with these groups, the bill makes only a dent in the total appropriations overseen by the House Health Care and Human Services Finance Division.

“This is a committee that spends a lot of money on some very worthy people with some very important needs, but it is absolutely not broke,” he said. “We are not down to the bone. We have not found the muscle.”

Rep. Steve Gottwalt (R-St. Cloud) echoed similar sentiments about the bill.

“It is not cutting total spending. It is not cutting General Fund spending. It is adding people to public programs at a cost we can’t afford,” he said.

The budget bill does not include a controversial House amendment that would have eliminated tax breaks for corporations with operations overseas. It does appropriate funding for some State Operated Services facilities that were slated for closure and designates an advisory group to provide input on the division’s future.

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