Gov. Paul LePage recently unveiled a two-year budget proposal that capitalizes on successes in his ongoing effort to get Maine’s fiscal house in order. In addition to a bold, $300 million tax cut package designed to grow Maine’s economy, the budget contains promised initiatives within the Department of Health and Human Services to pay down waitlists for elderly and disabled Mainers, increase funding to nursing homes and support primary care physicians to improve health outcomes for Medicaid recipients.
These initiatives are possible due to DHHS’ successful efforts to stabilize Medicaid spending and enrollment. Doing so also enables Gov. LePage to focus on other key priorities, such as education, infrastructure and economic development.
The tax reform package that the governor included in his biennial budget proposal offers a prime example of what is possible when DHHS is no longer running large shortfalls. In turn, economic growth generated by the governor’s tax cut will benefit the very individuals the department serves every day by increasing jobs in Maine.
There is no question that Maine’s DHHS was on an unsustainable course when this administration took office in 2011. Maine’s Medicaid spending, enrollment and share of the state budget had doubled in the decade prior. Prior administrations paid for this growth by failing to pay hospital bills, cutting rates to other health care providers and continually seeking millions of dollars every year to cover significant budget holes.
In response, Gov. LePage dialed back Medicaid enrollment from a high of 354,000 in 2011 to 291,000 in 2014 and paid off Maine’s hospital debt. In 2011, Maine’s Medicaid enrollment as a share of its population was more than 40 percent higher than the national average. Today, we have met the national average, which has enabled us to now report no significant shortfall for the first time in recent memory.
In crafting our budget request, DHHS identified over $100 million in savings to pay for over $100 million in much-needed initiatives to help our most vulnerable neighbors.
Among these critical funds are $46 million to provide home- and community-based care for elderly and disabled people on Medicaid waitlists. These include severely autistic teenagers who just graduated from high school or elderly Mainers who want to age at home but just need some help from time to time. They include people with severe brain injuries or developmentally disabled adults living with elderly parents.
We pay for this critical initiative in part by reforming General Assistance welfare reimbursement to municipalities. State GA spending grew from $5 million in 2003 to $13 million in 2014 in part because cities had a major incentive to spend more. We’re proposing to rein in this spending and put this program back on track.
Gov. LePage’s 2016-17 budget also provides $24 million in state funds to struggling Maine nursing homes, which are severely underfunded. This includes providing a $2.2 million grant to help rural nursing homes. Gov. LePage is keeping his promise to Maine seniors and all those who work hard every day to provide them the quality care they deserve.
Part of reducing Medicaid spending, and health care spending overall, is encouraging prevention by increasing access to primary care providers and care management. That’s why, with federal funds expiring this year, we propose to use $28 million in state funds to maintain the Health Homes initiative and a higher reimbursement rate for primary care providers serving Medicaid patients.
Health Homes are primary care providers that provide coordinated physical, mental and behavioral health care to drive down costs and improve outcomes. They are paying off, as we have already seen monthly costs drop among super-utilizers from $1,400 to $1,000. Higher reimbursement for family doctors taking Medicaid patients is essential to ensuring recipients have access to preventive medicine and avoid costly emergency rooms.
Finally, Gov. LePage’s budget prioritizes the mentally ill by providing $14 million to meet Maine’s obligations under the Consent Decree and increase funding for Bridging Rental Assistance Program housing vouchers
All the work we have done during the governor’s first term to stabilize Medicaid spending comes down to this: tax reform to grow Maine’s economy and spending priorities at DHHS realigned to help the truly needy.
We have finally bailed out the boat and are now charting a new course toward a sustainable welfare system that no longer tries to be all things to all people, but instead focuses on keeping its promises to the truly needy for whom its services were originally intended.
Mary C. Mayhew is commissioner of the Maine Department of Health and Human Services under Gov. Paul LePage.