Legislative Update
January 21, 2011
Early Medicaid
Enrollment Gets Boost
Governor Mark Dayton made
news earlier this week with his announcement that the “early
Medicaid” expansion would begin by March 1st, rather than
the October date projected by outgoing Pawlenty administration
officials. With the Governor’s authorization earlier this month, up
to 95,000 individuals will be eligible for the joint state-federal
program, replacing the state’s General Assistance Medical Care (GAMC)
program and expanding care for others presently covered under
MinnesotaCare. According to the Dayton administration, 32,000
people currently on GAMC will make a seamless transition on March 1,
with another 51,000 people phased in over six months. This later
group will be able to get retroactive coverage back to March 1 once
they are enrolled.
“Since Governor Dayton signed the Medicaid expansion
executive order two weeks ago, this transition has been our number
one priority” Commissioner Jesson said. “The expedited
implementation schedule will require all of us – state and county
workers, health care providers and community partners – to work
quickly and coordinate our efforts so this transition goes as
smoothly as possible.” Implementation will include outreach to
people who are eligible but not enrolled in state programs.
The
changes were made possible by the federal health care
reforms passed in 2010, and were the subject of much debate during
both last year’s legislative session and gubernatorial campaign.
One day after taking office earlier this month, Governor Dayton
signed the executive order making the expansion possible. The
governor and DFL legislators were highly critical of earlier
statements by DHS officials that the expansion would take up to 10
months to complete. This expansion is expected to bring in $1.1
billion of new federal money and provide more comprehensive coverage
for adults without children earning below 75 percent of the federal
poverty level.
Freedom
of Choice in Health Care Act,
SF33
In related action, Senator David
Hann (R – Eden Prairie) introduced SF 33, a bill that would roll
back the early Medicaid enrollment and declare that every resident
of Minnesota has the freedom of choice in health care. This is an
attempt to give ammunition to the state to oppose the federal
mandate for health insurance The bill, the text of which is
available
HERE, does not have a companion introduced in the House yet but
it will be heard in the Senate on Wednesday January 26.. Governor
Dayton has stated that he will veto any attempt to undo the state’s
participation and, in fact, participated in a press event this week
with U.S. Health
and Human Services Secretary Kathleen Sebelius singing the program’s
praises.
Governor
Announces DHS Commissioner
Gov. Dayton announced his
pick of Hamline University law professor Lucinda Jesson to direct
the largest agency in state government, the Department of Human
Services. This position has been highly anticipated as it is
expected that the DHS budget will be the main target for budget cuts
by the Legislature.
Jesson is a
former prosecutor and a deputy attorney general under former
Attorney General Skip Humphrey. She also served on the Dayton
transition team. Jesson, who directed Hamline's Health Law
Institute, will have one of the toughest jobs in state government.
With health care costs growing more rapidly than other portions of
state government and subsidized health programs a top target of the
new majorities in the Legislature looking to erase a $6.2 billion
projected budget deficit, the task at DHS is daunting.
The commissioner quickly announced key members of her
team. Anne Barry, the DHS Chief Compliance Officer is the new
Deputy Commissioner. Scott Leitz, who worked on health care reform
for the Department of Health and is currently the director of public
policy for Children’s Hospitals and Clinics will be assistant
commissioner for health care. Lauren Gilchrist is the new assistant
commissioner for health policy and reform. A former senior health
policy advisor to Sen. Al Franken and a health policy fellow to Sen.
Edward Kennedy, Gilchrist will spearhead the agency’s efforts to
implement health reform, coordinating across DHS and with Commerce
and Health. Glichrist’s father is Dr. Gerald Gilchrist, a
pediatrician from Rochester. Finally, Maureen O’Connell, a legal
advocate is the new assistant commissioner for Chemical and Mental
Health Services Administration.
First Round of
Budget Cut Proposals—Make Unallotment Permanent
Republican leaders
in the Senate and House announced the start of their budget
balancing work with the introduction of SF 60 (Robling – Jordan) and
HF 130 (Holberg – Lakeville). These two bills permanently extend
the unallottments signed into law by former Governor Pawlenty.
This extends the
temporary cuts passed last year indefinitely.
In total there
would be $840 million in one-time spending cuts made permanent.
These include $584 million in cuts to tax aids and credits
(primarily to local governments); $185 million to higher education;
and $72 million to various health and human services programs.
Various
House committees passed bills this week related to these permanent
cuts. The HHS cuts do not
apply to physician reimbursements.
The HHS cuts, found
in HF 128 available
HERE, permanently extend the 2010 cuts to basic care programs
(though not physician reimbursements). Programs for low income
Minnesotans such as Emergency General Assistance and Emergency
Supplemental Aid Grants, as well as Child Support Enforcement Grants
to counties would also see cuts.
The
Office of Management and Budget (MMB) was also directed to identify
an additional $200 million in savings that could be achieved by
capturing unspent funds in all agencies’ budgets. Dayton has
already signaled his opposition to this proposal and said that the
legislature should hold off until his budget is released and there
can be public discussion of the choices offered for budget
solutions.
Chairman
Gottwalt Introduces Plan to Change MinnesotaCare
Rep. Steve
Gottwalt (R – Saint Cloud), chair of the House Health and Human
Services Reform Committee, introduced HF 8, a bill to shift a
significant portion of MinnesotaCare enrollees to private
insurance.
His
bill, available
HERE, would provide subsidies to eligible adults without
children with incomes above 133% of the federal poverty level to
purchase individual, private insurance in place of MinnesotaCare.
Subsidy levels are determined on a sliding scale based on age and
income. Gottwalt explains the bill as moving from a “defined
benefit” program to a “defined contribution” program.
In purchasing
coverage in the private market, insurers will be allowed to
underwrite for these new purchasers. Those individuals denied care
in the private market because of a pre-existing condition would
receive a subsidy that is 20% higher to seek coverage from the
Minnesota Comprehensive Health Association (MCHA), Minnesota’s
high-risk insurance pool.
Rep.
Gottwalt notes that under his proposal, physicians and hospitals
would receive the significantly higher reimbursement rates of
private payers, rather than the low Medicaid rates. Fiscal notes
prepared by non-partisan staff for earlier, similar proposals have
suggested that the bill would save over $100 million over a
biennium. Critics have countered that the savings would largely
come from individuals being unable to navigate the private system
and dropping coverage
The bill received
its first hearing in the House Health and Human Services Reform
Committee this week. Committee DFLers expressed some interest in
the plan, though voiced concern about whether the plan would allow
some lower income individuals to lose their care entirely due to the
complexities found in the private insurance market, as well as
whether they could afford to pay $1,000, $3,000 or $5,000 deductable.
Democrats were rebuffed in their efforts to amend the bill with a
requirement that the private insurance products provide mental
health coverage. Also defeated were amendments that would mandate
that individuals denied coverage be referred to MCHA (though that
option remains for those denied), as well as limits on the cost of
premiums and deductibles. The bill passed committee on a voice vote
and was referred to the House Commerce Committee.
The bill’s
companion is being carried by Senator David Hann, and is scheduled
to receive its first Senate hearing in his committee on Wednesday
January 26.
Federal
Conformity Dependent Coverage Health Care Reform Act (SF 47/HF 79)
Employees will not have to
pay state taxes on the value of health insurance for dependents and
adult children up to age 26 for tax year 2010 only under a provision
that passed in House and Senate tax committees this week. This bill
conforms state tax law to the Federal Health Care Reform bill that
expanded dependent coverage. Both private and public employers were
hoping that the bill would have also passed this federal conformity
for 2011 and beyond to avoid the administrative burdens caused by
the need to withhold the appropriate state taxes but not federal
taxes for this benefit for employees with dependent coverage. The
Senate tax committee chair hopes to take up the issue for tax year
2011 and beyond within the next 30 days. Unfortunately, this issue
has gotten tangled up in whether or not a legislator supports the
“Obamacare” bill. There were several new members who were concerned
that supporting the federal conformity maybe confused with support
of the federal reform bill.
Legislative
Committees Continue Their Overviews
While
new bills continue to be introduced in the legislature (already
totaling slightly more than 260 in both bodies), much of the
committee action thus far has been informational in nature. All of
the health care committees have taken testimony from various agency
and department officials, non-partisan legislative staff, and a
number of interest groups. With so many new members on all
committees, the chairs are using these first weeks to bring their
members ‘up to speed’ on the issues before them.
House HHS
Finance Work Groups Formed
House HHS
Finance Committee Chairman Jim Abeler (R – Anoka) and House HHS
Reform Committee Chairman Steve Gottwalt, this week announced the
formation of 8 study groups intended to review issues and develop
reform proposals. It’s unclear what role the public will have with
these work groups and whether their meetings will be open to the
public. The groups and their members are:
|
Topic |
Members |
|
Welfare |
Reps. Lanning &
Hayden |
|
Child Care |
Reps. Franson,
Peterson & Slawik |
|
Hospitals |
Reps. Kiffmeyer,
Murphy, Norton & Benson |
|
Health Care and
Dental |
Reps. McDonald,
McElfatrick, Gruenhagen, Huntley & Laine |
|
Mental Health
and CD Waivered Programs |
Reps. Barrett,
Diane Anderson, Lohmer, Mack, Hosch &
Loeffler |
|
Long Term
Care |
Reps. Hamilton
& Schomacker |
|
MDH, Rural
Health & Public Health |
Reps. Quam &
Huntley |
Talk of a Government Shutdown?
The House Health
and Human Services Finance Committee on Thursday received testimony
from senior Minnesota Management and Budget staff about the process
for shutting down state agencies. The staff described the steps
taken in 2001 to prepare for a shutdown, which was averted, and in
2005, when some state agencies were closed for 8 days. In both
cases, “critical life, health, safety and life functions” were
ordered to be maintained. Partisan tempers flared when DFLers
questioned whether the hearing was a signal the Republican majority
wasn’t serious about completing its work on time, while Republicans,
including Committee Chairman Jim Abeler, noted that the value of the
briefing was to prod legislators to complete their work to avoid the
trauma and disruption of a shutdown.
State of the
State and Budget Plan Dates
Governor Dayton will
deliver his “State of the State” address on February 9. He also
announced that his budget will be released on February 15th. State
law requires the governor to present his budget plan by the 15th and
Dayton announced that he is using the entire time to put his budget
together. With the delay in the election results, the announcement
did not come as a surprise.
- Dave Renner, MAFP
Legislative Representative
(drenner@mnmed.org,
612-362-3750, 1-800-342-5662)
|
