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House HHS Budget: Part 1 – Medicaid Wins, Tobacco Cessation Loses

State lawmakers rolled out their health and human services budget today, one that provides more beds in state psychiatric institutions and makes adjustments to Medicaid while hacking at smoking cessation programs, targeting Planned Parenthood and cutting adolescent pregnancy prevention programs.

Part 1 of 2

By Rose Hoban

State lawmakers rolled out their budget for health and human services Thursday, one that would spend about $161 million more than what the legislature originally budgeted for the upcoming fiscal year. But House budget-writers asked for about $16 million less than what Gov. Bev Perdue requested last week to spend on health and human services in the upcoming year.

Even with the increases, some programs will see cuts, and a some of programs have been eliminated.

Legislators presented their budget at a House subcommittee meeting, where advocates, members of the Democratic opposition, and many HHS officials saw the numbers for the first time. Lawmakers only had until the end of the morning meeting to present any amendments to the $4.6 billion budget.

Medicaid

Image courtesy of Images of Money, Flickr Creative Commons

Lawmakers allowed for more dollars for Medicaid, in recognition of increased demand on the program in the economic downturn. They also opted to retain optional services under Medicaid, items such as prescription drug coverage, dental coverage and physical therapy, and held the line on reimbursement to providers.

State officials are continuing to project increased demand for the program, even as the state’s employment picture improves.

“Historically, Medicaid has grown even with stable unemployment because of population changes,” said Medicaid business operations head Steve Owen. “Since 2000 there have been only two years where Medicaid enrollment fell. There’s also a lag in how unemployment affects Medicaid growth. Next year, we’re projecting a combination of population growth, along with trends from the last two years to see increased demand.”

  • Governor’s request for additional Medicaid funds: $109,435,319
  • House request for additional Medicaid funds: $166,676,461

Much of the difference in the two budget amounts comes from different ways of accounting for money owed to the federal government for overpayments made to the Medicaid program in 2009, and repayments owed because of changes in drug rebate policies, a total of $55 million.

Lawmakers also fixed a long-standing problem for low-income Medicaid recipients who receive Social Security or pensions, and whose cost-of-living-adjustments push them sometimes just a few dollars over the eligibility limit for the Medicaid program.

“It’s an issue that we’ve been hearing about for years,” said Rep. Verla Insko (D-Chapel Hill).

She said in the past lawmakers had been concerned that changing eligibility limits for Medicaid would mean additional people would enter the program who had previously not been served.

According to officials from DHHS, the change ineligibility would allow about 9,200 extra people to enter the state’s Medicaid program, in addition to keeping those whose cost of living increases will be disregarded.

In the Senate chamber, legislators held the final vote on a bill to close a Medicaid funding gap that was the focus of political football through the winter. The provision provides $206 million in funding from various sources to eliminate the gap.

Gov. Bev Perdue signed the measure within hours of the bill’s passage.

Smoking cessation efforts lose 2/3rds of funding

This year, North Carolina will receive about $144 million as a result of the Tobacco Master Settlement Agreement, signed in 1998 after a multistate lawsuit against tobacco companies.

But House budget writers want to spend less than 4 percent of that money on tobacco cessation and prevention programs in the upcoming budget year.

Statewide campaigns such as this would be prohibited under the new budget

Last year, the state spent $17 million on tobacco control programs, including the free tobacco Quitline, the Tobacco. Reality. Unfiltered. media campaign and the Tobacco Free Kids program. Gov. Bev Perdue’s budget trimmed funds for tobacco cessation to $10 million, and the House budget trims the funds further, allocating only $5.46 million.

Last year, North Carolina’s high school student smoking rate hit an all time low of 15.5 percent, down from 43 percent when the T.R.U. program started in 2003.

The cuts would eliminate $1.9 million for the Quitline, said Peg O’Connell, a spokeswoman for the tobacco cessation programs. “State employees can still call the Quitline, and there’s about 5 days of federal funding for uninsured people. Everyone else is left out in the cold.”

A special provision in the House budget also forbids spending any money on statewide tobacco cessation marketing and media campaigns, limiting the programs to local programs.

“The Centers for Disease Control and Prevention recommends on-the-ground programs, a quitline to help people who want to quit, and you need to wrap it in a media strategy,” O’Connell said. “If you take out the Quitline and you take out the media strategy, all you have left is puppets and postcards.”

All states except for Ohio, Nebraska, Virginia, Missouri, Kentucky and New Hampshire provide funding for a quitline.

“Every day the industry spends millions of dollars advertising to young people,” O’Connell said. “Ten million is better than five million, but at least the ten million was to set up an evidence-based program.”

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