State budget could include Medicaid cuts

Published 10:10 pm Wednesday, February 24, 2016

MONTGOMERY (AP) — An Alabama Senate committee on Wednesday approved a lean general fund budget that could spell deep cuts for Medicaid services in the state.

The Senate General Fund Finance and Taxation Committee approved the $1.8 billion budget that includes no additional money for Medicaid, a scenario that would cause cuts to optional services and could thwart plans to shift the system to managed care. However, Committee Chairman Trip Pittman described the budget as a work in progress.

“I thought it was important to get a budget moving that reflected the reality of where we are,” Pittman said.

Pittman said he hoped the plan would spark conversations about potential cuts and funding. The Alabama Senate could vote on the spending plan as soon as Thursday.

The budget is about $100 million less than the one proposed by Gov. Robert Bentley as lawmakers, so far, have rejected his idea to shift education funds to the cash-strapped general fund.

The committee-passed budget also gives level funding to Medicaid, about $100 million short of the $795 million sought by Bentley.

Medicaid Commissioner Stephanie Azar said that would not be enough to maintain existing services. The agency would have to cut non-mandated services such as outpatient dialysis, she said.

It would also squelch the state’s ability to maintain its end of a waiver agreement with federal officials to “adequately” fund its program as it tries to transition to managed care.

“If we are not funded at $795 million, with or without the waiver, we will be crippled,” Azar said.

Pittman said the plan isolates the state’s budget problem on Medicaid, rather than attempting to “cannibalize” other state agencies with deeper cuts.

The budget is far from a settled issue, however.

Pittman described the committee-approved spending bill as the first step of a journey as lawmakers begin work on the 2017 budget.