Legislative Update
In Washington...President Bush Released his Budget Proposal for FY2005...
The highlight of the health care recommendations includes no new provider cuts. The proposal also includes a $200 million increase for health centers; $100 million for Health Care Information Technology initiatives ($50 million for state or regional demonstration grants) to test the feasibility of information exchange among health providers and fund other innovative IT projects; and $50 million in AHRQ’s budget to fund grants to continue efforts to promote, accelerate, and demonstrate the development and adoption of IT, including in small and rural communities.
In addition, President Bush’s budget recommendations include an overall increase in discretionary spending of .5 percent when the defense and homeland security increases are pulled out. Health and Human Service’s discretionary budget falls by 1.6 percent. There is only a 2.5 percent increase ($764 million) for NIH, including an increase of $121 million for NIH biodefense efforts. Hospital preparedness funding is reduced to $476 million (from $515 in FY 04). And finally, health professions training spending was cut from $294 million to $11 million.
And on Beacon Hill...Governor Romney Releases FY2005 Budget Proposal. . .
Romney released his $22.97 billion FY2005 budget recommendation, which increases overall state spending by approximately $1 billion, but significantly reduces Medicaid reimbursement to hospitals, physicians and other providers. Under the Romney plan, acute hospitals will face $100 million statewide in new Medicaid reductions, on top of $50 million in hospital cuts last year, including non-payment for patients whose hospital stay extends beyond 20 days. Romney also proposes to limit access to hospitals for Medicaid and free care patients, and to reduce free care pool funding by $60 million in FY05. The plan is under review by the House Ways and Means Committee, and the House is expected to release its version of the budget in mid-April.