Mississippi Health Care Association Files Suit to Stop Medicaid Cuts

The Mississippi Health Care Association, the Independent Nursing Home Association and dozens of nursing homes from across the state filed a lawsuit Thursday seeking to stop the Mississippi Division of Medicaid from making a planned $14 million cut in payments to providers.

The lawsuit filed in Hinds County Chancery Court late Thursday afternoon argues that state reserve funds can be used to shore up the Medicaid budget and the cuts are unnecessary.

The suit seeks an injunction to stop the cuts over the uncertainty of "adequate funding" for providers. The cuts are pending federal permission.

Mississippi Medicaid recently announced plans to cut $14 million in reimbursements to health care providers for services for the remainder of the fiscal year, which ends June 30, because of successive months of revenue collections below estimates. However, tax revenue collections were on target in March.

Calls by Democratic lawmakers to dip into state reserves to close the gap have been rebuked by Governor Barbour (R), who argues the state's savings needs to last for several years.

The largest chunk of money went to public education, and Medicaid was not on the restoration list. About $14 million of an $82 million budget patch-up plan approved by lawmakers, however, was provided via a stimulus-related federal government reimbursement to the Division of Medicaid.


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Arizona's CHIP Plan Spared Elimination

Arizona's Children's Health Insurance Program plan (CHIP), which was slated for elimination on June 15, will no longer be cut due to the federal health reform law that President Obama signed into law March 23. According to the Arizona Health Care Cost Containment System, the reprieve came in the form of a maintenance-of-effort provision applicable to children's health care through 2019. It prevents states from changing eligibility requirements in such a manner that would force individuals off existing rolls.

The Legislature now must repeal the action that eliminated the KidsCare program, AHCCCS spokeswoman Monica Coury told BNA April 7. It is expected to do so before the June 15 sunset date.

But the restoration of the program means the state's budget falls out of financial balance, and now must be reconciled either by additional spending cuts or tax increases, something Arizona's legislators have been opposed to doing.

No agreement has been reached on how the fiscal hole may be patched. Arizona's budget must be balanced, under the state's constitution.

The maintenance-of-effort requirement applies to Medicaid generally and was included in the federal stimulus bill, but was scheduled to expire at the end of 2010, according to the AHCCCS website.

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State of Idaho Witholding Medicaid Payments to Providers for 30 Days

The Idaho Department of Health & Welfare plans to delay payment to all providers in the state for the entire month of June, 2010. They are doing this to meet budget cuts to the Medicaid appropriation for FY 2010. The state of Idaho’s constitution does not allow the state to end the fiscal year with a deficit, so their solution is to end the year paying for only 11 months of expenses with 12 months of revenue.

Thank you to Russ McCoy with the South Park, Inc. dba Developmental Options for bringing this to ANCOR's attention. Read more!

Center on Budget and Policy Priorities Issues New Briefs

The March 2nd brief finds that if a state cuts a tax, it generally has to make an offsetting cut to expenditures for a program or service in order to maintain balance. This spending cut is likely to reduce demand in the state just as much as the reduction in taxes may stimulate demand.[1] It is at best a zero-sum game, where the gains in one area are offset by the losses in another. Given states’ balanced budget requirements, neither a broad-based tax cut nor a jobs credit can do much to increase overall economic activity in the state. This tax brief is a good companion to the February 16th CBPP brief A Balanced Approach to Closing State Deficits used in connection with ANCOR's February 18th Audio Conference.

CBPP also released on March 3rd an update on state budget cuts. The report found 45 states making cuts that are harmful to vulnerable populations.
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GAO March 2010 Report on State and Local Governments' Fiscal Outlook

The new report found that state and local government sectors continue to face near and long-term fiscal challenges and although the sector's near-term operating balance remains negative the federal Recovery Act assistance alleviated pressure with March 2010 operating balance measures showing an improvement compared to January 2009. In the near-term the sector's fiscal position can be attributed to several factors--including steep revenue declines. Absent any policy changes, GAO projects that the sector's long-term fiscal position will steadily decline through 2060. The decline is primarily driven by rising health care costs. Read more!

FY 2010 State Budget and Economic Survey

ANCOR State Budget Survey Shows Cuts in Services
Members are Urged to Respond to Next Survey

ANCOR asks its members to fill out a quarterly survey that asks questions about your state budgets and how they affect your organization and its ability to support individuals with disabilities. This survey is important because staff can take this information to Capitol Hill when meeting with members of Congress. The answers you give help paint a picture, with real people—the people you support, their families, and your employees -- of what cuts in Medicaid mean to services and supports for individuals with disabilities. In fact, ANCOR encourages you to talk to your federal lawmakers; the more they hear from you the more they will remember how important Medicaid funding is to the work you do.

ANCOR’s most recent survey yielded 65 respondents and a total of 33 of states. Over half of the agencies that responded to the survey received a cut in reimbursement. To deal with cuts, some providers increased the size of living arrangements and decreased the amount of direct support hours.

ANCOR members report the numbers of individuals on waiting lists continue to increase and in many states no funds are available to provide supports to anyone on the waiting list, while provider capacity to take emergency referrals has diminished.

Many providers have been forced to reduce the amount of support to “essential services,” greatly limiting the participation of individuals in their community and their independence. Defining elements of community life, such as access to social, recreational, and religious opportunities, have become limited or eliminated due to transportation and staffing cuts.

This information is just a snapshot of what ANCOR members report. Specific agency names and those making these reports are kept confidential. We hope as more information is collected over time, we can show more data; however, in the mean time, the information collected in this survey is critical to influencing individual members of Congress. Please watch for another survey in April and take the time to respond. Your influence in Congress depends on it!



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New York Governor Proposes Budget With Reduced Medicaid Spending Growth

Governor David A. Paterson (D) January 19 proposed a fiscal year 2010-2011 state budget that would reduce the growth in New York's Medicaid program and impose some $240 million in new health care assessments and surcharges. The $134 billion budget for the fiscal year that starts April 1 would reduce Medicaid reimbursement for hospitals, nursing homes, and home care providers by $459 million in FY 2010-2011.

The state's Medicaid caseload is expected to increase by 400,000 in FY 2010-2011.

Under the budget, the state expects to recover $1.2 billion from fraud and abuse in the Medicaid program, a $300 million increase from the current fiscal year.

The budget also would reinstitute a requirement that health insurers obtain prior approval from the state before imposing rate increases.

Further information on the health care portion of the budget is available at http://publications.budget.state.ny.us/eBudget1011/fy1011artVIIbills/HMH_ArticleVII_MS.pdf


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Recession Continues to Batter State Budgets

The Center on Budget and Policy Priorities (CBPP) updated its state fiscal report on December 18th projecting budget gaps for this year and next year combined for a total of more than $350 billion. Although the ARRA fiscal relief to states mitigated states’ fiscal problems—closing state-shortfalls by 30-40%--states are continuing to cut services like education and health care as they implement 2010 budgets. Additional cuts are likely for 2011.was enough to close 30-40% of state shortfalls. More than 30 states have raised taxes and several are considering similar measures. Visit the website for the complete updated policy brief.
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FY 2010 ANCOR State Budget Survey

The purpose of this survey is to continue ANCOR's quarterly efforts to collect information from individual providers and state associations on FY 2010 state budgets and mid-year state FY budget adjustments (announced or anticipated cuts) and their effects on disability providers' capacities to support individuals with disabilities of all ages.

There are "inside beltway conversations" by economists and public-interest "think tanks" with some key Congressional leaders about a one-year extension to the American Reinvestment and Recovery Act (ARRA) federal, Medicaid temporary increase to states (FMAP). These discussions are occuring very early in the process (ANCOR is a part of these) with rumors that no real movement will take place until after the first of the new year. There is very mixed Congressional interest regarding FMAP extension and a state stabilization fund with some in leadership stating that it will be either a FMAP extension OR a broader, more flexible state stabilization fund, but not both.

The information we are asking in this survey will help ANCOR demonstrate in the coming weeks to Congress the case for FMAP extension on behalf of state need, but even more importantly, on the specific direct effects on individual providers and individuals with disabilities.

Please complete this online survey by December 31st!
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VICTORY! Governor Patrick Rescinds Mass Health/Day Hab Cuts

Massachusetts Governor Reverses Budget Cuts for Day Hab Restoring $100 Million in Recent Medicaid Disability Cuts. Thanks to ADDP Exec Gary Blumenthal for sending news of this victory which is on top of ADDP’s October success in defeating a $60 million cut in DD services. Congratulations Gary and ADDP!
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Mid-Year Shortfalls Open a $31 Billion Gap in 35 States

According to an update by the Center on Budget and Policy Priorities, at least 42 states plus the District of Columbia are enacting cuts in major areas of state services—including health care (28 states) and services to individuals with disabilities and the elderly (24 states and DC). The worst recession since the 1930s has caused the steepest declines in tax receipts have led many states to face large budget gaps even after making deep cuts. You can view a table of state-by-state mid-FY 2010 budget gaps at http://www.cbpp.org/cms/index.cfm?fa=view&id=711
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Additional Federal Fiscal Relief Needed to Help States Address Recession’s Impact or State Could Lose 900,000 Jobs in 2010

A November report by the Center on Budget and Policy Priorities finds that without additional federal assistance, states could be forced to institute additional deep budget cuts and tax increases in 2010. Although states received federal assistance for education, jobs and for their Medicaid programs last year with the passage of the ARRA stimulus, states will face a “cliff” on December 31, 2010 unless additional federal funding is forthcoming. With most governors sending their budget proposals to state legislatures between December and February, state lawmakers will have to pass budgets as early as March or April in some states and by the end of June in almost all states. If states do not know they will receive additional federal fiscal relief, they will begin implementing new budget cuts and tax increases by this summer, at the latest. The CBPP report states that budget projections suggest that states will face total deficits for state fiscal years 2011 and 2012 of as much as $260 billion beyond what can be covered by the limited ARRA funding that will remain available—reducing demand in the U.S. economy by as much as $260 billion. Read more!

Maine revenues continue to slip; shortfall as high as $400M

Gov. John Baldacci has ordered the preparation on an executive order to curtail state spending as state revenues continue to fall below estimates with Finance Commissioner Ryan Low expecting the revenue shortfall now will range between $300 million and $400 million for the two-year budget.

He said when preliminary figures were known late last week, the governor ordered the preparation of a curtailment order to stop state spending under his emergency budget authority. He said the curtailment process cannot make up for the entire revenue shortfall, but it is important to stop spending as soon as possible.

Last month the governor ordered agencies to identify how they would cut spending to meet a target of $200 million. Low said instead of another round of requests, his office will use those as a starting point and in one-on-one meetings with state agencies, push for further spending cuts.

Thank you to Bonnie-Jean Brooks for providing ANCOR with this information. Read more!

NGA and State Budget Officals Project States Will Continue to Face Fiscal Difficuties in Comming Years.

In a preliminary review of the biannual report The Fiscal Survey of States, officials from the National Governors Association (NGA) and the National Association of State Budget Officers (NASBO) today forecasted continued fiscal difficulties for states. In fiscal 2009, states were forced to reduce General Fund expenditures by 4.8 percent and are expected to reduce fiscal 2010 General Fund expenditures by at least 4.0 percent, marking the first time that state spending has declined in back to back years. The weakening of state fiscal conditions is reflected in the $250 billion in budget gaps faced by states between fiscal 2009 and fiscal 2011. Of the $250 billion, states closed $72.7 billion in budget gaps during fiscal 2009 and $113.1 billion before the enactment of their fiscal 2010 budgets to bring them into balance with drastically declining revenues.

"These are the worst numbers we’ve ever seen in the decades of putting together this report," said NASBO Executive Director Scott D. Pattison. "States have been forced to lay off and furlough employees, raise taxes, drain rainy day funds and sharply cut state spending in ways that impact every part of state government."

Even after closing these gaps, an additional $14.5 billion in budget gaps remains in fiscal 2010, and states face at least $21.9 billion in budget gaps for fiscal 2011. To help close these gaps, 42 states cut their enacted fiscal 2009 budgets by $31.2 billion, and 33 states cut their fiscal 2010 expenditures by $53.5 billion. Additionally, states enacted tax and fee increases of $23.8 billion along with additional increases in other revenue measures of $7.7 billion for fiscal 2010.

"States will continue to struggle over the next decade because of the combination of the length and depth of this economic downturn, the projected slow recovery and the overhang of unmet needs," said NGA Executive Director Raymond C. Scheppach. "The unmet needs are those postponed or deferred during the crisis including, replenishing retiree pension and health care trust funds and financing maintenance, technology and infrastructure investments. States will also need to rebuild contingency or rainy day funds. The bottom line is that states will not fully recover from this recession until late in the next decade."
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Connecticut Budget Update

Governor Rell of Connecticut announced rescissions of up to 5% in various state agency line items at the end of the day November 5. The Governor can make line item cuts up to 5% without need for Legislative approval. The total of the rescissions is $34M. The deficit is now projected at $400M by the Office of Policy and Management (the Governor’s budget office) and at $628 by the Comptroller. The Secretary of OPM stated yesterday that the intention is to balance the budget through cuts, not higher taxes.

Most of the cuts in the human services state agency accounts are in the “Personal Services” line – the account for state personnel salary/wage expense. The DCF residential Board and Care – Foster and Residential and Emergency Services had the largest reductions that have the potential to affect community providers. In DDS, the autism pilot was reduced, but other service delivery accounts were not touched. DMHAS wasn’t cut. DSS cuts include a reduction in “Aid to the Disabled,” a large account. Medicaid wasn’t cut.

The Governor’s press announcement
The proposed rescissions (14 pages)

Thank you to Stan Soby of Oak Hill for providing ANCOR with this update.

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NASDDDS Survey on State Plans to Close or Downsize

In late October 2009, NASDDDS conducted a brief email survey of member state agency officials regarding the existence of plans to close or downsize large state-operated institutional programs in their respective states. Respondents were additionally requested to indicate whether or not their current plans were being implemented in response to financial considerations.

Total NASDDDS member state agencies: 51

Total number of states responding to the survey: 49 (96%)

Of the 49 responding states, 11 (22%) states reported that they had closed all state operated institutions for persons with intellectual and developmental disabilities (IDD).

Of the 38 states operating institutional programs that responded to the survey (unduplicated count):

4 (11%) states are planning to close one or more facilities and not downsize other programs or facilities.

14 (37%) states are planning to downsize existing facilities but not close any institutions.

5 (13%) states are panning to close one or more institutions and downsize additional facilities.

15 (39%) states have no plans to close or downsize state operated institutional programs.

Summarizing the results of the data from the 38 states reveals that:

9 states (24%) have plans to close one or more institutions.

19 states (50%) have plans to downsize programs, reducing the census of existing facilities.

Financial Impact

10 states (26%) made the decision to close and/or downsize IDD facilities due to financial reasons.

Of the 4 states with plans to close some facilities but not downsize others, three states are closing the facilities for financial reasons.

Of the 14 states with plans to downsize but not close facilities, three states are downsizing for financial reasons.

Of the 5 states with plans to both close and downsize existing facilities, three states made the decision for financial reasons.
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Massachusetts Governor Makes Budget Deal Protecting Bulk of DD Services

Governor Deval Patrick of Massachusetts, has shielded the bulk of DDS services and supports from an earlier anticipated reduction that would have cut services for thousands of people with developmental disabilities. Specific 9C DDS budget impacts were outlined. To implement the Governor's 9C decisions, the Legislature must still grant the Governor expanded 9C authority.

Special thank you to Gary Blumenthal for providing us with this information. Read more!

Maine Faces More Budget Cuts

State departments in the state of Maine are being asked to recommend ways to cut their budgets by $200 million. The state departments have two weeks two come up with suggestions as Ryan Low, commissioner of the Department of Administrative and Financial Services, and Gov. John Baldacci prepare a supplemental budget. Each department has been given an individual target with Health and Human Services and Education set to receive the largest cuts.

Thank you to Bonnie Jean Brooks providing this update. Read more!

Iowa State Budget Update

Thursday, October 8, 2009 Governor Chet Culver of Iowa announced a 10% across the board cut. Up until now, Medicaid providers in Iowa had been exempted from the two previous cuts due to the federal stimulus dollars.

Most Medicaid eligible recipients in Iowa have their local match paid by their county of legal settlement rather than the state. The only savings to the state would be for persons who are state cases and do not have a determined county of legal settlement. The estimate for ICFs/MR is that with a 10% rate cut the state would forfeit $12M in federal funding to save only $400,000 in state dollars, or a loss of $30 for every dollar saved.

It is unsure at the point whether Iowa may require legislative action for cutting Medicaid. That would mean the Governor Culver would have either to call for a special legislative session or wait until the next session convenes in January.

Thank you to Rod Braun from Christian Opportunity for this update.
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Virginia Announces Plan to Address FY2010 Budget Shortfall

Governor Tim Kain today announced his plan to address the FY 2010 budget shortfall of over $1.35 billion.

While there are no projected rate cuts for Medicaid services in the plan offered by the Governor today, the plan does:

• eliminate 100 of the 200 MR/ID Waiver slots which were approved by the General Assembly for January 1, 2010
• reduce funding for community services boards by 5%
• eliminate 20 DBHDS Central Office positions and require a one day furlough for all executive branch staff (for most the Friday before Memorial Day)
• eliminate direct management of the Community Resources Pharmacy

It also projects a General Fund savings of $97M because the federal Medicaid share has increased from a projected 60.19% to 61.58% for the last quarter of FY 09 and for FY10 as a result of the Federal stimulus package.

Click here to read the entire report.

Special thanks to Jennifer Fidura for providing us with this information.

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