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2015 legislative update: Medicaid could end under Alabama House committee's budget
Medicaid could end in Alabama under devastating cuts in a proposed General Fund (GF) budget that the Alabama House’s GF budget committee approved Tuesday, State Health Officer Don Williamson said. About one in five Alabamians would lose their health coverage, including nearly half of Alabama’s children and about 60 percent of the state’s seniors in nursing homes.
Medicaid would lose 23 percent of its state funding, or $156 million, next year under the budget that the committee approved Tuesday. Lost federal matching money would increase the loss significantly.
Those cuts likely would lead to the closure of Children’s Hospital in Birmingham, as well as dozens of other hospitals and nursing homes across the state. “If Alabama chooses not to have a Medicaid program, you will see an impact on the health care system that you can only begin to imagine,” Williamson said Tuesday.
Cigarette tax increase, other revenue bills fail to gain traction
The vote came after key parts of Gov. Robert Bentley’s plan to raise new revenue to prevent massive GF cuts went nowhere during a tense day in the House’s GF budget committee. The panel voted 8-7 Tuesday to reject a plan to increase the state cigarette tax by 25 cents per pack (from 42.5 cents to 67.5 cents). A bill to increase the business privilege tax on large corporations was on the agenda but did not come up for a vote.
The committee recessed for several hours after the cigarette tax vote. When it returned late Tuesday afternoon, a frustrated Rep. Steve Clouse, R-Ozark, who chairs the committee, offered an amendment to concentrate GF budget cuts in the Medicaid program. Committee members approved the change 10-4 and then OK’d the budget on a voice vote. The GF budget now awaits action in the full House.
Democratic committee members strongly condemned the proposed Medicaid cuts. “To take and use Medicaid as a pawn, I think is totally unfair,” said Rep. John Knight, D-Montgomery. “Other agencies should be on the chopping block.”
Knight urged legislators to be honest with the public about the need for new GF revenue to support vital services like health care, child care and public safety. The Legislative Black Caucus will not vote for tax increases without adequate long-term GF revenues, Knight told the Montgomery Advertiser.
Clouse criticized several Democratic lawmakers’ votes against the cigarette tax bill, telling the Advertiser that Democrats had supported a tobacco tax increase during the regular session. “I came with a fair budget that level-funded Medicaid,” he said. Clouse said he does not support deep Medicaid cuts but said Alabama needs to have a debate about the program’s future.
Lawmakers OK transfer of education revenues to shore up General Fund
Both the House and Senate’s GF budget committees approved bills Tuesday to transfer use tax revenues from the Education Trust Fund (ETF) to the GF. The use tax is equivalent to a sales tax on goods bought outside the state for use within Alabama. It is commonly discussed in the context of Internet or mail-order purchases.
The House committee voted to transfer both use tax revenues and some funding obligations to the GF, resulting in a net loss of $50 million to education and a net GF gain of the same amount. The Senate bill would transfer use tax revenues but not the accompanying obligations. That would reduce education revenue (and increase GF revenue) by more than $200 million.
Alabama’s education funding is still well below pre-recession levels. The state’s per-pupil K-12 spending in 2015 was 18 percent lower than in 2008, the second worst decline in the nation, according to the Center on Budget and Policy Priorities (CBPP). Alabama’s per-student higher education cuts from 2008 to 2016 are also the nation’s second worst, the CBPP found.
Bentley has proposed to “backfill” the ETF’s revenue loss by ending the state income tax deduction for FICA taxes paid to support Social Security and Medicare. But this bill has not yet been set for a committee vote, and many press reports suggest it is unlikely to pass.
Bill to ‘un-earmark’ mental health, DHR money advances in House committee
The House’s GF budget committee also approved a bill Tuesday to “un-earmark” revenues dedicated to five state agencies and shift the revenues into the GF. Nearly 90 percent of the transfers under HB 46, sponsored by Rep. Allen Farley, R-McCalla, would come from mental health and the Department of Human Resources (DHR). Other services affected would be public health, veterans’ affairs and forestry.
Bentley’s budget plan would provide additional GF money to help the agencies cover the un-earmarked amounts. But neither the current Legislature nor future ones would be obligated to do so under HB 46. Advocates for children and for people with mental illness are deeply concerned about this idea.
By Carol Gundlach, policy analyst, and Chris Sanders, communications director. Posted Aug. 4, 2015.
Lawmakers should focus on a General Fund budget that will make Alabama stronger
ACPP policy director Jim Carnes issued the following statement Friday, July 10, 2015, in response to Gov. Robert Bentley’s call for a special session on the General Fund budget:
“Alabama is at a crossroads. The path we choose now could define our state for a generation. As lawmakers consider the General Fund budget in the coming weeks, we urge them to choose a path that will make Alabama stronger.
“Alabamians need a budget that protects children, seniors and our most vulnerable neighbors. Important services like Medicaid, mental health care and public safety make Alabama a better place to live and work. But these services have been cut to the bone in recent years, and even deeper cuts are not the way to repair the damage. It’s time to stop the cuts and invest in a stronger Alabama.”
New revenue for a stronger Alabama
What makes a state strong? We likely all could agree on a few answers: healthy people, a dependable workforce, a stable government, safe streets and vibrant communities. But without new revenue to address a huge General Fund budget shortfall, Alabama will face devastating cuts to education, health care, public safety and other vital services that make shared prosperity possible.
If the Legislature can’t agree on new revenue to avoid these cuts, Alabamians would see thousands of lost jobs, a sharp decline in our state’s quality of life and a weaker future for years to come. Here’s a snapshot of what Alabama would look like if the cuts in a no-new-revenue General Fund budget become reality.
ACA ruling a huge win for affordable health care in Alabama
ACPP policy director Jim Carnes issued the following statement Thursday, June 25, 2015, in response to the U.S. Supreme Court ruling upholding Affordable Care Act tax credits in Alabama and other states:
“The Supreme Court’s decision is a huge victory for millions of Americans, including more than 170,000 Alabamians who have gained health coverage through the federal Marketplace. This ruling protects tax credits that make coverage more affordable for 132,000 Alabamians, and it protects all Americans from the soaring insurance costs that would have resulted from a decision the other way.
“With today’s ruling, health coverage for thousands of Alabama families is safe and sound. Now it’s time for Alabama to take the next step and close the Medicaid coverage gap for thousands more. Health reform is the law of the land, and our leaders should work to make sure it succeeds in providing access to affordable coverage for all Alabamians.”
2015 legislative update: What went well in 2015 -- and the challenges that remain for Alabama
It’s over! But it’s not over yet. After approving a wholly inadequate General Fund budget that would jeopardize our state’s future, the Alabama Legislature ended the 2015 regular session Thursday. But Gov. Robert Bentley vetoed that budget, and he will call lawmakers back for a special session on the budget later this summer.
Arise members celebrated some big victories this year, but major challenges still remain. Here’s a quick review of how Arise issues fared:
Budgets and taxes: None of Bentley’s revenue bills passed. Without new revenue, vital services like Medicaid and public safety face devastating cuts that would hurt Alabama’s quality of life for years to come. Just a few examples:
But there was some good news, too. Lawmakers overwhelmingly approved a bill to save money and give Alabamians more choices in Medicaid long-term care services. The state will have a powerful new tool – a “tax expenditure report” – to determine if tax breaks are worth the cost. And a new prison reform law will help save money and reduce overcrowding – but it only takes effect if the state funds it.
Ending Alabama’s lifetime SNAP ban: Alabamians can celebrate a big win for second chances! The prison reform bill includes language ending the state’s lifetime SNAP and TANF eligibility bans for people with a past felony drug conviction. Thousands of people can regain SNAP eligibility on Jan. 30, 2016, if the prison reform law gets the money required for it to take effect.
Alabama Accountability Act: The Legislature approved major changes to the act. The new version allows more money that would have supported public education to go to private schools instead – but it also includes some of Arise’s recommendations for greater accountability and transparency.
Housing Trust Fund: A bill to fund affordable housing in Alabama encountered powerful opposition and did not emerge from committee. Supporters plan to meet with opponents to seek agreement before the 2016 session.
Payday and title lending reform: In a big win for consumers, the Alabama Supreme Court ruled the state Banking Department can create a single statewide database of payday loans. But much work remains in the drive for a 36 percent interest rate cap: No bills to regulate payday or auto title loans passed, but public pressure for reform continues to grow.
The regular session is over, but Arise’s work continues. Stay tuned for updates as we prepare for this summer’s crucial debates over our state’s future. Together, we can build a better Alabama for all!
By Kimble Forrister, executive director. Posted June 4, 2015. Updated June 12, 2015.
General Fund cuts would weaken Alabama's future
ACPP executive director Kimble Forrister issued the following statement Thursday, June 4, 2015, in response to the Alabama Legislature’s passage of a General Fund budget that slashes vital services like Medicaid, mental health care and public safety:
“This shortsighted General Fund budget would weaken Alabama’s economy and our future. Services like Medicaid, mental health care and public safety boost our quality of life and provide the backbone for economic growth. But Alabama has cut these services to the bone in recent years, and this budget would make the situation even worse. Children, seniors and our most vulnerable neighbors would suffer as a result.
“Alabama simply can’t afford these damaging cuts. It’s time to stop cutting the services that make our state a better, healthier place to live and to start investing in Alabama’s future.”