House passes, but Senate rejects DHHS budget

Maine Reps. David Webster, D-Freeport, and Margaret Rotundo, D-Lewiston, pore over documents during a work session at the legislature's Appropriations Committee at the State House in Augusta, Maine, on Monday, June 6, 2011.
Pat Wellenbach | AP
Maine Reps. David Webster, D-Freeport, and Margaret Rotundo, D-Lewiston, pore over documents during a work session at the legislature's Appropriations Committee at the State House in Augusta, Maine, on Monday, June 6, 2011.
Posted Feb. 16, 2012, at 6:08 p.m.
Last modified Feb. 17, 2012, at 9:18 a.m.

AUGUSTA, Maine — Senate Democrats late Thursday blocked passage of a supplemental budget for the Department of Health and Human Service just hours after their counterparts in the House approved it.

The compromise budget bill, LD 1816, cuts approximately $120 million from the current fiscal year DHHS budget through a combination of changes to MaineCare eligibility and shifting funds from various accounts. It also includes an additional several million in savings across state government that were identified by a budget streamlining committee last fall.

The House vote was 109-27, well above the two-thirds majority needed for the budget to go into effect immediately.

When it came to the Senate, though, only three Democrats voted in favor, leaving the final tally well below the two-thirds threshold.

“I’m stunned,” said Sen. Richard Rosen, R-Bucksport, the Senate chair of the Appropriations Committee. “We were promised by [Democratic] leadership that they would deliver the votes.”

Senate President Kevin Raye of Perry said the Democrats were obstructing the process.

Sen. Phil Bartlett, D-Gorham, said he and other Senate Democrats have reservations about a budget moving so quickly.

“We want to make sure we’re putting Maine people first,” he said. “We don’t want to pass a budget that creates winners and losers.”

The Senate is expected to revisit the budget bill next Tuesday.

Earlier in the day on Thursday, the House passed the budget with a last-minute amendment.

Rep. Patrick Flood, R-Winthrop, the House chair of the Appropriations Committee and one of the main brokers of the budget compromise, said Thursday there was “no joy in discussion of or passage of LD 1816.”

But he also pointed out that the budget committee passed the bill unanimously, a reflection of the great lengths its members went to compromise.

Rep. Peggy Rotundo of Lewiston, the lead Democrat on Appropriations, stressed that the compromise “is not a Democratic budget,” but said it was important to pass it anyway.

“We come to this agreement with great concern and pause,” she said. “However, we believe this budget allows us to keep the lights on, pay providers and continue to provide access to health care for many who wouldn’t have it under the governor’s original proposal.”

In December, Gov. Paul LePage released his plan to trim $220 million from DHHS in 2012 and 2013. That initial plan included stronger structural changes to MaineCare that would have removed an estimated 65,000 Mainers from government-funded health care.

Appropriations Committee members rejected some items in the governor’s budget and worked for weeks to find alternatives.

That compromise was to split the budget in two. The piece that passed on Thursday deals largely with the 2012 fiscal year. An additional $80 million in proposed cuts to the DHHS budget for 2013 are expected to be debated in a separate bill later this month.

Still, the compromise reached last week hung in jeopardy over the weekend after some Republican House members expressed concerns.

A last-minute amendment that passed in the House addressed those concerns and also included something the Democrats wanted.

The amendment first removed a provision from the budget that dealt with a tax on insurance claims with Dirigo Health, a sticking point for conservative House members.

Originally, the tax rate was set to drop from 1.87 to 1.64 percent but the budget proposed keeping the tax at 1.87 percent, allowing the state to retain about $5 million in revenue. The amendment ensures that the rate reduction goes into effect.

In exchange for that piece, House Democrats wanted to restore an estimated $14 million in funding to hospitals for the rest of fiscal year 2012 and 2013. LePage initially proposed cutting reimbursements to hospitals by $42 million, but the amendment allows the hospital to keep two-thirds of that total in exchange for a $14 million payment to the state.

The final element in the House amendment establishes a sunset date for childless adults, or noncategoricals, to be removed entirely from MaineCare rolls. That piece was pushed by the governor, according to House members, but likely will not matter much because care for noncategoricals is included in the federal Affordable Care Act.

Sen. Elizabeth Schneider, D-Orono, said she was not happy about the last-minute “deal making done in the dark of night.”

“I believe in a process that has been corrupted and the people in the state of Maine are not served by this process,” she said.

Others, however, pointed out that the amendment received unanimous approval from Democrats and Republicans on the Appropriations Committee.

But Bartlett said it wasn’t the amendment that caused Senate Democrats to balk.

“We’ll continue to have discussion with all parties to find a way to pass a budget,” he said.

Some major elements of the compromise proposal include:

  1. Capping MaineCare funding for childless adults, or noncategoricals, at $40 million by freezing enrollment and through natural attrition.
  2. Reducing the eligibility threshold for parents of children on MaineCare from 200 percent of the federal poverty level to 133 percent. That change will not take effect until October.
  3. Eliminating $2 million from the Fund for Healthy Maine.
  4. Requiring DHHS to substitute generic drugs for brand-name when appropriate for MaineCare participants.

Gov. LePage has expressed displeasure with the compromise budget in the last week, but it’s still not clear if he will support it. His spokeswoman, Adrienne Bennett, said early Thursday that the governor wants to see the final bill and any amendments before he weighs in.

Once it’s passed, the budget goes to the governor, who then has 10 days to sign it, veto it or allow it to become law without his signature.

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