Hearings Today on MaineCare Budget Cuts; MMA to Testify
The Appropriations and the Health and Human Services Committees will spend all day today and some time this evening hearing public testimony on the Baldacci Administration's FY 05 Supplemental Budget plan that was announced early last week and which has been the subject of considerable public commentary, even prior to the public hearing.
The FY budget gap is nearly $160 million dollars, the majority of which represents shortfalls in the MaineCare account. To address the deficit, the Administration proposes the following savings or revenue sources.
- $80 million in net MaineCare adjustments
- $9.4 million in projected Powerball revenue
- $38.5 million from "divesting the Internal Service Fund for Retiree Health"
- $2.1 million in increased motor vehicle fines
- $4.9 million from unappropriated surplus
- $9.2 million from Maine Revenue Services 'initiatives"
- a variety of other fee increases, transfers and one-time savings.
The following are highlights from the $80 million in MaineCare adjustments.
A. THE MAINECARE BASIC PLAN. This represents the Administration's proposed redesign of the MaineCare benefit package to achieve $20.7 million in savings from all adults and an additional savings from childless adults. Many optional MaineCare services are proposed to be eliminated, and several other services become subject to more prior authorization, medical management and utilization review.
The following services are eliminated for adults:
- * Podiatric
- * Dental
- * Occupational and Physical therapy
- * Speech & hearing therapy
- * Audiology
- * Optometric
- * Speech pathology
- * Social worker services
- * Ambulatory care clinics
- * Prosthetics/orthotics
- * Hearing aid dealers
- * Rehabilitative (Brain injury)
- * Adult day health
- * Psychological services
The budget also contains savings from several acute care proposals, including a doubling of the hospital tax (tax and match) from 0.74% to 2.2%. The tax proposal is expected to generate $6 million in savings. $900,000 is proposed to be saved from moving some hospital-based physician practices (those which have been designated as "provider-based" ) to CPT billing (See related article below).
Additional savings are:
- $6.25 million from the MaineCare pharmacy program through, among other things, "stricter prior authorization criteria for the preferred drug list."
- $5 million in savings from a voluntary mail order drug program for the MaineCare drug program and the Low-Cost Elderly Drug program.
- $3 million is savings from implementing a strict formulary in the Low-Cost Drug Program for the Elderly and DIsabled
- $203,000 in savings from redesign of the Medical EyeCare Program
Several million dollars are proposed to be cut in long-term care and in behavioral and developmental services. MMA will offer testimony opposing many of these cuts at the hearing today. The testimony will be given by MMA President-elect Lawrence Mutty, M.D.
More details of the Governor's Supplemental Budget can be found in MMA's Political Pulse published last Friday, March 12. Go to http://www.mainemed.com/members/Me-Med/index.html and proceed to the most recent issue of Political Pulse.
Below is a draft copy of the Association's testimony opposing several of these reductions:
TESTIMONY OF THE MAINE MEDICAL ASS0CIATION
SUPPORTING IN PART & OPPOSING IN PART
L.D. 1919, GOVERNOR BALDACCI’S SFY 2005 SUPPLEMENTAL BUDGET
Joint Standing Committee on Appropriations & Financial Affairs
Joint Standing Committee on Health & Human Services
Augusta Civic Center
Monday, March 15, 2004
Good morning Senators Cathcart and Brennan, Representatives Brannigan and Kane, and Members of the Appropriations and H&HS Committees. My name is Lawrence B. Mutty, M.D. and I am the President-elect of the Maine Medical Association (MMA), a professional organization representing more than 2600 Maine physicians.
Thank you for the opportunity to share the views of the MMA on the latest supplemental budget. Also, I am presenting testimony on some aspects of the proposal on behalf of the Maine Psychiatric Association.
Maine physicians realize that the Governor and his staff faced a difficult challenge in assembling a balanced budget. With the presentation of L.D. 1919 to you, the challenge is now yours. In good financial times, the Legislature has, with the support of the MMA, expanded eligibility for the MaineCare program and for related health care, mental health and mental retardation, and substance abuse services in a strategy of incremental health care reform. Given the 2-to-1 federal match in the Medicaid program, this has been a rational strategy.
The last half dozen or more budgets have, however, preserved eligibility while cutting provider reimbursement and the benefits available to the public under these programs. During the debate on each of the recent budgets, the MMA has expressed concern about the impact of continued cuts in our health care, MH/MR, and substance abuse services on patients and on the practitioners and facilities who serve them. Our concern grows more acute with each budget that attempts to balance the MaineCare budget solely by adjusting the MaineCare budget. Today, we cannot warn you strongly enough that you cannot run the programs Maine has built during the last 5 years while cutting reimbursement and benefits without harming patients and threatening the financial viability of some providers.
Governor Baldacci and the Legislature’s leadership have asked for public feedback about alternatives to the proposed cuts in L.D. 1919. One alternative is obvious - - the MMA and other public health advocates argued during the SFY 2004 supplemental budget that you should consider raising the cigarette tax by $1 to $2 per pack. Not only will this generate somewhere between $50 and $70 million in new revenue, it will have the greatest impact on consumption of any single tobacco policy decision you may make. In the course of one short year, Maine has moved from having the second highest cigarette tax in New England to the second lowest. This certainly is a more rational policy decision than the “tax and match” approach affecting Maine’s nursing homes and hospitals. I have attached a fact sheet on the cigarette excise tax prepared by the Maine Coalition on Smoking OR Health.
The MMA has the following specific comments about portions of L.D. 1919.
1. MaineCare Basic. The MMA objects to the elimination of coverage for the 15 services in the MaineCare Basic package. The MaineCare system is certain to experience additional costs elsewhere in the system if these services are eliminated. The Maine Psychiatric Association is particularly concerned about the proposed elimination of psychological services from the benefit package. Appropriate mental health care depends upon the skills of both psychiatrists and psychologists being involved in the patient’s care.
2. Hospital “tax and match.” The MMA is concerned that the expansion of the hospital “tax and match” in Part HH of the budget is poor health policy that we should not come to depend upon.
3. Paying hospital based physician practices on the same basis as independent physician practices. The MMA opposes this $900,000 (General Fund) cut in physician reimbursement. The MMA supports the principle that physicians performing the same medical services should be reimbursed the same, regardless of setting. But, the State should accomplish this by bringing reimbursement for physicians in private practice up to reflect their practice costs as is the case for hospital based practices, federally-qualified health centers, and others. As members of both committees know very well, the MaineCare program’s reimbursement rates for individual practitioners are among the worst in the country - - 44th according to one recent study (Comparing Physician and Dentist Fees Among Medicaid Programs, Medi-Cal Policy Institute, June 2001). I have attached, for your information, a comparison of 2002 MaineCare, Medicare, and Anthem rates for 20 common primary care codes - - this is a document that members of the H&HS Committee will recognize from a bill earlier in the 121st Legislature.
4. Stricter prior authorization criteria in the MaineCare drug management program. The MMA acknowledges the need to save money in the MaineCare drug budget and we have worked in good faith with the Bureau of Medical Services staff and contractor to ensure that patients still are able to obtain medically necessary drugs with as little burden on physician practices as possible. The Preferred Drug List (PDL) program, however, still imposes an overwhelming administrative burden on physician practices. Many practices have found it necessary to devote a staff member almost full-time to processing MaineCare prior authorization requests. Physicians are concerned that the proposal to seek an additional $6.25 million in savings through “stricter PA criteria for the PDL” will make it even more difficult for physicians to negotiate the PDL and will raise the risk of harm to patients.
5. Redesign of the Medical Eye Care Program. Section DD-2 of the budget would save $203,000 by severely restricting both the eligibility for and scope of services available under the Medical Eye Care Program. Saving this small amount of money will threaten the eyesight of a significant number of poor elderly and other vulnerable Maine citizens.
Samuel Solish, M.D., an ophthalmologist from Falmouth who is the President of the Maine Society of Eye Physicians & Surgeons, has offered the following initial comments about this proposal.
By deleting "or" they make it that they have to have both a blinding disease and bilaterally severely impaired to be treated.
Pt has an eye injury in only one eye....the state will not treat! Absurd!
Patient has cataracts in both eyes. They have to wait until both eyes are worse than 20/70 to have surgery AND only one eye can be operated on! There goes any chance that they could POSSIBLY have a job which involves vision prior to meeting eligibility and forget a job that involves driving.
Glaucoma is a potentially blinding disease but central visual impairment is often a late manifestation of this disease. Peripheral vision loss can be very severe before vision decreases to 20/70 best corrected.
These kind of rules keep people in poverty.
If I am not mistaken, I think 20/70 is used by the state division for the blind as visual impairment and qualifies for assistance from the division! I know the Iris Network (formerly the Maine Center for the Blind and Visual Impairment) is able to assist people with 20/70 or worse.
6. Authority of the Commissioner of DHS to amend the MaineCare benefit and service structure without legislative review. The MMA strongly objects to Section DD-6 of the budget that appears to give the Commissioner of DHS broad authority to make major changes to the MaineCare program for adults without legislative approval “in order to manage the program.” Such an amendment would eliminate the Legislature’s proper oversight role and would jeopardize the public’s opportunity to participate in the policymaking process.
7. Expansion of the mental health parity law to include coverage for crisis and crisis residential services. The MMA and Maine Psychiatric Association long have advocated for parity in health insurance coverage for mental health care services and for medical services and both organizations support this limited expansion of Maine’s mental health parity law.
8. Reporting of infants with prenatal exposure to drugs. Part Z of the budget amends the provision of Title 22 requiring health care practitioners, among others, to report instances of suspected child abuse or neglect to DHS by including a reporting requirement if “the provider knows or has reasonable cause to suspect [the infant] has been born affected by illegal substance abuse or suffering from withdrawal symptoms resulting from prenatal drug exposure.” The MMA is uncomfortable with the inclusion of this substantive proposal in a budget document. Part Z suggests that the intent of the change is to ensure that the infant receives appropriate services and that the proposal does not require prosecution for illegal behavior. Still, the MMA believes that such a significant change should be presented as a stand alone bill to the committee of jurisdiction - - probably in the next Legislature - - when the committee and all interested stakeholders can consider the merits of the proposal without the pressure of the budget process.
The MMA urges you to seek alternatives to the proposed cuts to health care, MH/MR, and substance abuse services in L.D. 1919. After several years of budget cuts in our health and social welfare system, further cuts will cause real harm to the Maine citizens who depend upon these programs and will damage the moral and effectiveness of the providers upon whom the success of these programs depend.
Thank you and I would be happy to respond to any questions you may have.