Wednesday, March 23, 2011

Special Session - Day 8 Update


Action Turns to Senate
(Curious to how we got here, see all of our special session updates at blog.govplan.com)

Tomorrow is shaping up to be a big day in the Senate relative to House Bill 1, legislation to address a $166 million Medicaid budget shortfall. We anticipate that a Senate version of the bill will be considered by the Senate Appropriations & Revenue Committee and the full Senate on Thursday. We have heard that the bill may very well be headed to a conference committee with the House to work out a final compromise, though the situation remains fluid. We believe Senate A&R will meet at 10:00 a.m. and the Senate will convene at 1:00 p.m. 

Details of the Senate plan remain scarce, though based on the line of questioning today the Senate Majority seemed skeptical of the Beshear Administration's ability to deliver the projected savings. They may look at more across the board cuts to generate a larger share of the funds needed to balance the shortfall. We hopefully will have more details in the morning and will communicate those.

Senate A&R
The Senate spent today beginning its deliberations on House Bill 1. The Senate Appropriations & Revenue Committee held a series of three meetings today with CHFS Secretary Janie Miller appearing before the committee. These meetings provided an opportunity for committee members to ask questions on a variety of topics related to the Medicaid budget shortfall, and more specifically could the Cabinet could achieve the savings of $139 million included in the House version of HB 1. The main themes of the key members' questions surrounded these issues:

- In the House plan the State Budget Director has to certify the Medicaid managed care savings or budget cuts go into place. How are these Medicaid savings defined? How will we know you have achieved those savings in August when you will only have signed the contracts in July? Is the Budget Director the right person to make the certification?

- Number of Medicaid Eligibles: The Cabinet has projected that the rate of growth in new Medicaid eligibles will slow to under 2000 per month on average in FY 2012. What happens if the number goes up? Won't that impact the savings in the plan?

- There was significant questioning about these managed care contracts and how these contracts could guarantee the savings in Medicaid that the administration thought they could garner. There was also questions about how quickly the administration would have to move in order to get these in place by July 1. There were several in-depth questions regarding how many contracts, what services they would cover, etc.

- From members of both parties there was several questions asked about the level of confidence Secretary Miller had that she could generate the savings in the House plan. To all of them she said that she was confident, though she did say that not all of the savings would come from managed care as other Medicaid efficiencies would also be needed to make up the rest of the savings.

Secretary Miller's answers to these questions was generally forthcoming and she at least attempted to answer 6 hours worth of questions today. The one exception was that Miller refused to answer questions directed towards the RFP's, because she said that the RFP's would be on the street next week and the Cabinet was in the procurement process, which precluded her from communicating any of those details. This was very frustrating to many on the committee.

These articles will give you a flavor for the tenor of the hearing:


House & Senate Daily Actions
Neither Chamber took significant legislative action on the floor today, and the House adjourned until Noon on Thursday and the Senate adjourned until 1:00 p.m. on Thursday.

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