Special Session - Day 3 Update

Here is an update on legislative activities in each chamber from Day 3 of the Special Session, the Senate letter to the Governor regarding the Medicaid budget shortfall is available HERE:

House

The House Appropriations and Revenue Committee met this morning and continued testimony from provider groups who would be impacted by 35% cuts if the Medicaid deficit isn't resolved.  The groups that spoke to the impact of the cuts were Kentucky Assoc of Homes and Services for the Aging, KY Dental Association, KY Association of Regional Mental Health/Mental Retardation Programs, KY Association of Private Providers, and the KY Association of Adult Day Centers.  All groups urged the General Assembly to resolve the budget problems and detailed how they would be forced to implement a  35% cut in reimbursement.  The A&R committee plans to take additional testimony tomorrow afternoon and Chairman Rand said it could be early next week before the committee takes action on HB 1 - the Governor's proposal.

The House voted on HB 2 on the floor this afternoon while in Session.  HB 2 is the legislation the Governor has touted the past several sessions that would increase the age at which students can drop-out of school.  The measure passed the House and will be sent to the Senate.  The Senate has not acted on this bill in previous sessions, and we have no indication they will do so during this special session.

Following action on HB 2, the House adjourned for both parties to caucus with their members. 

Senate

While the Senate has been fairly quiet in the previous few days, we saw activity today on a couple of fronts.  The Senate A&R committee met briefly during a recess this afternoon and passed SB 1.  SB 1 is legislation that addresses the post-secondary education funds that allow the state to comply with Federal maintenance of effort provisions. This was part of HB 305 from the regular session and while there seems to be no opposition from either side, the Medicaid budget disagreements prevented any action from being taken.

In addition, Senator Leeper (chair of the A&R committee) communicated with the body, when the Senate reconvened.  He announced to members that the Senate Leadership had sent a letter to the Governor outlining 9 principles that they have entitled Roadmap to a Responsible Solution.  The letter is available here.  It seems as though this is their attempt to begin the discussion on reaching a solution.  Speaker Stumbo and all members of the General Assembly were copied on the letter.

Prior to adjourning for the day, Senator Stivers announced that they will reconvene at 2pm tomorrow afternoon and then again at 9am on Friday.  He told members that at this time he doesn't have information as to whether some or all members would need to be in Frankfort over the weekend.  He also said that it was the Senate's hope to have HB 1 in their possession for action on Monday morning.  That doesn't seem to fit with the time guidelines provided by the House this morning.

Special Session - Day 2 Update

Special Session - Day 2 Summary


Probably, the big news out of Day 2 is that Speaker Stumbo and House Minority Leader Hoover have met and are discussing a compromise plan from the House on HB 1 to deal with the Medicaid budget shortfall. Although details are not clear at this point it appears that they are looking at a plan that would give the Governor an opportunity to make savings in Medicaid, but if he is unable then cuts would be made to state government to balance the budget. The one area that would not be cut is education. This is still in its early stages and according to press reports the Senate has not been involved in these discussions thus far.


After beginning with a flurry on Day 1, the second day of the Special Session got down to business with several committees meeting. House Bill 2, Rep. Greer's legislation to raise the drop out age to 18 by 2016, being voted out of committee and headed to the House floor for a vote on Wednesday. Here is a recap of today's legislative activity:


House
As is usually the case in special session's involving the budget the activity begins in the House. That was the case today with three House Committees meeting and taking testimony on how possible budget cuts would impact various areas of state government.


Education Committee: Passed out favorably HB 2, legislation to raise the drop out age to 18 by 2016. The committee also heard from representatives of various education groups about how past, current and proposed budget cuts would impact everything from small independent districts, teacher staffing, and implementation of past legislation regarding testing. The general theme was that they are running on very tight budgets now and further cuts would directly impact services provided.


Appropriations & Revenue Committee: Did not vote on HB 1, the vehicle for amending the budget to deal with the Medicaid budget shortfall. They did take testimony on the impact of the proposed 35% cuts to Medicaid reimbursements to providers if the legislature is unable to solve the Medicaid budget deficit. The committee heard testimony from the KHA, KMA, Local Pharmacies, and KY Health Care Facilities Assoc. Here are the high points:

KHA:  The cut equals a $125 - $130 million dollar reduction to hospitals in Kentucky. The reimbursement cuts will likely lead to employee furloughs, reduction in hours, delay in hiring, and suspension of certain services. In response to a question, Mike Rust said that he does not anticipate any hospitals shutting down over the 3 months that cuts are in place.

American Pharmacy Services Corporation: Represents roughly 200 independent pharmacies in mainly rural counties discussed examples as to what a pharmacy will lose due to the cuts. One such example is that a pharmacy will lose roughly $64 for every 30 day supply of Lipitor.

KMA: The reimbursement cuts will effect 8400 physicians statewide. Many doctors have said they may not stop seeing Medicaid patients altogether, but they will be forced to reduce the number of patients they do see.  It was also pointed out that the cuts will have a devastating effect on doctors who practice in the rural areas of the state and depend largely on Medicaid and Medicare patients.

The Kentucky Association of Healthcare Facilities: Had a similar story to tell. On average statewide, nursing facilities depend on Medicaid for 65% of their budgets.

Judiciary Committee - Heard from several groups including Justice Secretary Brown who discussed how the proposed budget cuts could affect implementation of HB 463, the corrections/penal code reform legislation passed in the 2011 Regular Session. There was also presentations from prosecutors and public defenders that in essence these budget cuts amounted to less people and would increase case loads.


On the floor today, the House gave 2nd readings to HB 1 & HB 2. The schedule for tomorrow is:


10:00 a.m. House A&R Committee will meet and hear further testimony regarding budget cuts effects on agencies.
2:00 p.m. House Convenes for a vote on HB 2, the drop out bill.
Upon House Adjournment: The House Democrats will be caucusing, most likely on the proposed compromise discussed above. That could mean HB 1 could move out of the House on Thursday.

Senate
Things were relatively quiet in the Senate today, which is natural given that the House generally gets first bite of the apple on appropriations bills. That being said the Senate did give second reading to SB 1, 2, and 3, although its not clear if any of these can be acted on in this special session.


We will continue to keep you updated as things develop.

Special Session Update - Day 1

And so it begins...

The Special Session got underway in Frankfort Monday with both the House and Senate convening this afternoon. You will recall this Special Session was called by Governor Beshear when legislative leaders could not come to an agreement on how to solve a $166.5 million deficit in Medicaid before the 2011 Regular Session ended last Wednesday.

The Politics

Not surprisingly, the two sides, House Democrats with Governor Beshear versus Senate Republicans, have not had much change in their positions since last Wednesday. If anything the politics of the situation have intensified and further entrenched each side.

Today those politics were on display as Governor Beshear started a two-day barnstorming tour to sell his plan and Senate President David Williams challenged Beshear to a statewide debate on the issue. Here is an example of some of the media coverage:

Ronnie Ellis/Daily Independent

Amanda Van Benschoten/NKY.com

Tom Loftus/CJ

Today's Legislative Actions

The House came in today and got the process started by filing HB 1, which appears identical to HB 305 from the Regular Session, which moves $166.5 million from FY 2012 to FY 2011 to balance the Medicaid budget. The House Minority Leader filed HB 3, which is similar to HB 1 except it only moves $100 million. House Bill 2 dealing with raising the drop out age was also filed today.

HB 1 & 2 were both given their first readings and sent to their respective committees, which are scheduled to meet and consider the bills tomorrow morning with the idea that they would be ready for consideration by the full House on Wednesday. House Education will meet @ 8:30 a.m. to take up HB 2, and House A&R will meet at 10:00 to take up HB 1 the budget bill. Beyond considering legislation, these committees along with the Judiciary Committee will be taking testimony regarding the impact of the proposed Senate Budget cuts.

In the Senate, there were also three bills filed: SB 1, dealing with the post-secondary education maintenance of effort issue; SB 2, restricting legislative pay during special sessions; and SB 3, the Senate plan for dealing with the Medicaid budget essentially across the board cuts 0.316 percent in the last quarter of FY 2011 and by 1.58 percent in FY 2012, including .65 percent cut for SEEK in FY 2012.

The fate of all three bills are unclear, because SB 1 and SB 3 are appropriations bills which must start in the House and SB 2 deals with an issue not on the special session agenda. No committee meetings were scheduled as of this writing.

How lawmakers got here: A summary of the Medicaid budget breakdown

How lawmakers got here: A summary of the Medicaid budget breakdown: "

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Filing Deadline Passes, Lineups are Set

Today was the filing deadline to file to run for one of Kentucky's Constitutional Offices that will be elected in November. The Governor's Race is the main event and Governor Steve Beshear did not get a Democrat opponent for the May Primary. On the the Republican side, three candidates will battle for the GOP nomination in May to challenge Beshear in November: Senate President David Williams, businessman Phil Moffett, and Jefferson County Clerk Bobbie Holsclaw.

The article below does a good job of outlining the various races and we will have more analysis as these races develop.

After filing deadline, lineups are set for May 17 Kentucky primary election: "By Beth Musgrave

FRANKFORT — Gov. Steve Beshear will not have an opponent in the May Democratic primary for governor, but Republican frontrunner and state Senate President David Williams will have two opponents.

Tuesday was the filing deadline to run for the state constitutional offices on the May 17 ballot.

In the Republican primary race, Williams and running mate Agricultural Commissioner Richie Farmer will face Jefferson County Clerk Barbara “Bobbie” Holsclaw and retired Navy officer and Jefferson County teacher Bill Vermillion Jr. Also on the Republican ticket is Phil Moffett, a Louisville businessman, who is running with state Rep. Mike Harmon of Danville.

Williams is the front-runner in both name recognition and fundraising. Williams and Farmer, a former University of Kentucky basketball player, have reportedly raised more than $753,196. Moffett has reported raising $53,000."