Senate proposes $114 million in cuts to health and human services

The Senate health and human services omnibus bill was released Thursday morning with little fanfare, revealing a plan to reduce the state’s budget deficit by $114 million in FY 2010-11.

Like the House bill released earlier this week, the Senate bill does not make many of the cuts to health care and services for vulnerable populations that the Governor proposed.

  • General Assistance for very low-income adults without children is left untouched.
  • Eligibility for health care for adults without children on MinnesotaCare is not reduced.
  • Very low-income elderly and disabled adults will continue to get help paying for meals, housing repairs and fees for guardianship.
  • The Governor’s unallotment reductions are not made permanent.

However, unlike the House bill, the Senate proposal protects families on the Minnesota Family Investment Program from any direct cuts to their benefits. And the Senate only proposes a few small reductions to mental health grants for children and adults, compared to the significant cuts proposed in the House bill.

The Senate bill (along with the House bill) takes advantage of the opportunity to expand Medicaid to provide health care for very low-income adults without children. The recently passed General Assistance Medical Care agreement – which was intended to provide health care for this population – has been falling apart as nearly every major hospital in the state has announced it isn’t feasible for them to participate in the new system. Expanding Medicaid would provide more certainty for both participants and providers. 

There are service cuts included in the Senate bill, although the full implications are still unclear – Thursday’s hearing announcing the bill lasted just an hour and there was very little discussion or testimony.

  • The Senate proposes a one-time reduction in Children and Community Services Act grants to counties for social services (which Senator Berglin says could be offset by expected federal funds). The House proposed a permanent reduction.
  • The Senate includes some cuts to child care assistance, which will increase the barriers for low-income parents trying to work.
  • The bill adopts the Governor’s proposed limit to the number of individuals with disabilities that can access home-based Medicaid services, which enables them to avoid being moved into a more expensive and confined institutional setting.
  • There is a 10 percent reduction in MinnesotaCare reimbursement rates to providers for services to adults without children over 75 percent of the federal poverty guidelines.
  • The Senate also cuts in-home supportive services for low-income elderly Minnesotans.
  • The bill proposes a surcharge on hospitals, nursing homes, facilities for individuals with disabilities, and HMOs to draw down federal dollars. These entities would get a corresponding increase in their reimbursement rates to keep them whole, although private-pay nursing home residents could see an increase in their costs.

There are additional cuts in funding to nursing homes, hospitals and other health care providers, but most of these reductions don’t take effect until FY 2012.

The Senate Health and Human Services Committee is expected to vote on the bill on Monday, sending it on to the full Senate Finance Committee.

-Christina Wessel

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About Christina Wessel

Christina served as the Minnesota Budget Project's deputy director until January 2014.
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