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AUGUSTA, Maine — Gov. Paul LePage told members of the Higher Education Council on Wednesday that if lawmakers do not reduce Medicaid and welfare benefits, education funding will need to be cut to bring the state budget into balance.
“Eighty percent of the budget is Medicaid and welfare and education,” he said. “If the Legislature has the political will to fix the problem, education will keep the additional $63 million we gave it.”
LePage urged the leaders of the state’s colleges and universities, public and private, to encourage their lawmakers to support his proposals to reduce Medicaid, called MaineCare in this state, and welfare spending.
He has not spelled out his proposals to address the projected $70.9 million shortfall in DHHS this budget year, but in comments to the group Wednesday he said Maine should not provide coverage through MaineCare that is greater than the national average.
“We are burning $6 [million] to $7 million more in money a month than we have budgeted,” LePage said. “We can’t continue at this rate.”
He said Maine is covering individuals at 200 percent of the federal poverty level, and suggested the state move to the national average of 133 percent. MaineCare covers a range of programs from medical care for the poor to nursing home costs for poor seniors.
“The national average of poverty right now, [including] entitlements … is 19 percent of the population,” LePage said. “In Maine, it is 27 percent of the population. We have got to fix that.”
He said he plans to propose a supplemental budget to address the DHHS shortfall by the end of the month so that lawmakers can start working on the problem in December. The governor said he wants action taken as swiftly as possible because the budget overruns continue to mount every week.
“This has to be fixed now; it can’t be allowed to continue,” LePage said.
An estimate in May by Maine Equal Justice Partners, an advocacy group for the low-income population, projected more than 12,000 Maine parents would lose MaineCare coverage under a reduction of services that would bring the state to the 133 percent level. The federal poverty level is defined as an annual income below $10,890.
The administration did not provide an estimate for the projected savings from such a move or an estimate of how many people would be affected.
Senate President Kevin Raye, R-Perry, said the governor is right when he says the state has to reduce its MaineCare costs and limit the program to available resources.
“We know the longer this drags into the new calendar year, the deeper the hole gets,” he said. “I think it is important for the Appropriations Committee to start work on this in December so hopefully we can have agreement early in January.”
House Minority Leader Rep. Emily Cain, D-Orono, agreed the DHHS budget shortfall is a serious problem but she said kicking Mainers off MaineCare will have a ripple effect on communities and families that needs to be considered carefully.
“Balancing a budget on the backs of the most vulnerable in our state is something that this Legislature has already rejected in this session in a bipartisan fashion,” she said.
Cain said it was not productive to pit one section of the budget, human services, against another part of the budget, education. She said the real solution to the problem is economic development and job creation.
“We have had an overemphasis on tax cuts for people on the more wealthy end of the spectrum and too much blame on those that are looking for work and trying to get off welfare programs,” she said.
Raye said the governor was right to point out that if MaineCare spending is not brought under control, education programs will suffer.
“That is where the money is in the state budget,” he said. “Those two items, human services and education, are by far the largest areas of the budget. I think we should take a very hard look within the DHHS budget because that is where the problem is occurring.”
But Cain said the approach to solving the budget shortfall should be broad-based and lawmakers should look at all areas of state spending and not expect the poor to bear the burden alone. She said asking college and university presidents to lobby for cutting MaineCare is just wrong.
“We need to use them for the resource they are,” she said, “not to drive an ideological agenda that is a conservative and cynical approach to social services.”
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