Where Things Stand with the FY 2013 Michigan Department of Community Health Budget

by Doug Paterson, MPA, Director of State Policy, Michigan Primary Care Association

Before the Michigan Legislature adjourned for spring recess, the Appropriations Subcommittee on Community Health in both the House and Senate reported out their respective versions of the FY 2013 budget (to begin October 1, 2012).  Because February revenues came in lower than expected, the Senate decided to defer many of the Governor’s proposed increases and instead put $100 “placeholders” on many line items until after the Revenue Estimating Conference is held on May 16. March revenues were better than expected and Senate Appropriations Committee Chair Senator Roger Kahn said last week that, if these projections hold, he hopes there will be support for increases. Highlighted below are what the current versions reflect for several line items of interest to Michigan Primary Care Association members.

1)      Overall Medicaid Funding – NO CUTS are proposed to Medicaid rates, eligibility categories, or eligible services. In fact, both houses support the addition of autism coverage adding another $34 million gross ($10.1 million general fund) for these services.

2)      Healthy Kids Dental – The Governor proposed an increase of $25 million gross ($8.4 GF) to begin expansion of the Healthy Kids Dental program over the next four years.  This amount is estimated to be 25% of what will be needed to cover the roughly 270,000 children still eligible but not covered.  The House reduced the amount to $7.9 million gross ($2.7 GF) and the Senate put a $100 dollar placeholder on this line item.

3)      Primary Care Reimbursement rates – Both houses support the Governor’s proposal to increase reimbursement rates for primary care providers up to Medicare rates. This increase of $281 million will be covered totally by federal funds. The Senate subcommittee also put a $100 placeholder on this line item to increase the rates for OB/GYN as well.

4)      Graduate Medical Education – The FY 2012 budget cut this line by $31.8 million to $136 million but put back $17.1 million of “one time” money for that year. In his proposed FY 2013 budget, the Governor recommends NOT continuing the one time amount of $17.1 million. The House continues the $17.1 million and adds another $859,000. The Senate put a $100 placeholder on this line item.

5)      Primary Care Line – The FY 2012 budget cut the previous line item by 15% ($330,000), which was restored last month in a supplemental appropriations bill. The Governor recommends the continuation of the restored amount in FY 2013 and the Senate concurred. The House, however, recommends continuing the line with the 15% cut.

6)      Healthy Michigan Fund – The current year line item includes $3 million of one-time funds. The Governor’s budget renames this line item to “Health and Wellness Initiatives” and continues this one time funding and adds another $2 million to cover his 4×4 wellness program (%1.25M) and Infant Mortality Initiatives (.75M). The House version eliminates all this one time funding and the Senate put a $100 placeholder on the line.

Other items of interest:

State Loan Repayment – The General Funds for this program were frozen two years ago to pay for the obligations outstanding but prohibited any new commitments of state funds to newly placed providers. As providers leave the program the amount of the funding available decreases. The Senate subcommittee bill creates a $100 placeholder for the restoration and expansion of this program.

Other $100 dollar placeholders by the Senate were also created for:

  • Island clinic funding for Beaver, Drummond and Mackinac Islands
  • A Dental Clinic in Kent County
  • $25,000 increase in the Donated Dental Program
  • Staffing for Integration of Services for Dual Eligibles
  • Restoration of Medicaid Adult Vision services
  • Restoration of Medicaid Chiropractic  Services

Each chamber’s budget will go to its respective Appropriations Committee for consideration, and then each chamber will vote on its bill. Conferees will be appointed in each chamber to negotiate the differences between the two bills and agree to a final single version. This will likely happen after the May Revenue Estimating Conference. Legislative leaders have indicated they would like to have the budget completed by June 1, 2012.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s