A Closer Look at Gov. Romney’s Proposed ’04 Budget
Governor Mitt Romney released his $22.86 billion FY 04 state budget recommendation at the end of February. It increases state spending by less than one percent and proposes $2.795 billion in cuts or savings. One substantial reduction impacting the health care industry includes $271 million in additional health care and prescription drug “program and eligibility” reductions (10 percent of total proposed reductions). At least $425 million of the Governor's “reform and restructuring” reductions apply to health and human service programs.
The Governor allocates approximately $6.5 billion to Medicaid for FY04, an 8.9 percent increase over FY 03 expenses of $5.96 billion. He notes that Medicaid has grown 76 percent since 1997 and that cost control initiatives have been outpaced by health care cost inflation, new technologies, increased reliance on prescription drugs, increased use of long-term care services and overall enrollment increases. The Governor’s projected cuts and/or savings to Medicaid and other health and human services programs break down as follows:
Premiums and Co-Pays $19 million
Implementing Drug Utilization and Case Management $87 million
Tightening Eligibility Procedures $27million
Adjusting Medicaid Rates $22 million
Long Term Care Reform $21 million
Administrative Consolidations and Restructuring $90 million
Maximization of Federal Revenue $159 million
Eliminating Refunds for Mandatory Medicare Part B $ 25 million
Suspension of Prescription Advantage Program $98 million
State Employee Health Premiums to 25% Share $80 million
Annualizing ā9Cā Emergency Reductions $173million
MassHealth Basic coverage (for the long-term uninsured population) is not restored in the Romney budget proposal. Coverage for HIV populations is boosted, but coverage for breast and cervical cancer treatment is not reflected in the budget. No additional reductions in eligibility are proposed.
Of the total $345 million allocated to the free care pool, the Governor eliminates the $45 million in additional state funding that has been in place for the past several years. He sets hospital liability to the pool at $215 million, state liability at $30 million, and insurer liability at $100 million. He does not propose additional funding for projected shortfalls in FY03 or FY04 but pledges to work with the legislature and others in the next two months toward a consensus approach to relieving the financial and programmatic pressures on the pool.
The Governor’s budget reflects his proposed reorganization of health and human services into four centralized departments reporting to the Executive Office of Health and Human Services (EOHHS):
- Department of Health (Medicaid, Public Health and Mental Health);
- Department of Children, Youth and Families (Social Services, Child Care, Transitional Assistance, Youth Services, and Office for Refugees and Immigrants);
- Department of Disabilities and Community Services (Medicaid Long TermCare, Mental Retardation, Mass. Rehabilitation Commission, Mass
Commission for the Blind, Mass. Commission for Deaf, State Soldier’s Homes); - Department of Elder Affairs (Elder Affairs and Vetera’s Services).