Join the Discussion
2014 legislative update: Medicaid, prison funding challenges remain as Alabama House committee OKs barebones General Fund budget
Medicaid, mental health and other human services in Alabama would face yet another year of tight funding under the General Fund (GF) budget that cleared a state House committee Wednesday. The committee’s version was virtually identical to the one that Gov. Robert Bentley recommended last month.
The committee approved next year’s proposed $1.8 billion operating budget for Medicaid, public safety and other non-education services after little discussion or debate. The budget now goes to the full House, which could consider it as soon as next week.
Big challenges ahead for Medicaid, prisons
Medicaid and state prisons would get nearly half of the GF’s money next year under the House GF budget committee’s plan, continuing the recent trend of those agencies consuming an increasingly larger share of the budget’s dollars. Medicaid would receive a $70 million, or 11.4 percent, increase, while the Department of Corrections would face a cut of $6.8 million, or 1.7 percent.
The committee’s proposed funding level could make it a challenge for Medicaid to maintain current services. Medicaid would remain $15 million short of the $700 million that State Health Officer Don Williamson said last month that it needs from the GF. The agency, which insures about one in five Alabamians, already has cut reimbursements for dental services, dialysis and services from non-primary care doctors. Williamson said the agency could survive next year by looking for more ways to trim costs in the prescription drug program and other areas.
Funding challenges also would remain for the state’s prison system. The corrections cut would come even as state prisons face a shortage of guards and run at nearly twice their designed capacity. Alabama also faces growing demands to hire more female guards, install more cameras and make other prison infrastructure improvements. Rep. Steve Clouse, R-Ozark, who chairs the House’s GF budget committee, said he wants to work with lawmakers to find more money for corrections.
Flat funding the norm for many other services
Other critical social services would receive essentially the same amount of GF money next year under the committee’s plan. The Department of Mental Health would be funded at the 2014 level despite the increased demand for community-based mental health services following the closing of several state mental health hospitals.
The Department of Senior Services, which provides Meals on Wheels nutritional assistance to the homebound elderly, was similarly level-funded. State courts, which have cut hundreds of jobs in recent years, also would get much less money than they requested.
The Department of Human Resources (DHR) would receive 16.8 percent, or $11.8 million, less from the GF next year. DHR’s allocation in Bentley’s recommended Education Trust Fund (ETF) budget would nearly double to offset that loss. Between the two budgets, Bentley recommended about a 2 percent increase for DHR. Because the ETF budget has not yet won committee approval, it remains to be seen whether the Legislature will support this increase. DHR provides child welfare, child support collection and elder abuse services. The agency also administers the Supplemental Nutrition Assistance Program (SNAP) and the Temporary Assistance for Needy Families (TANF) program in Alabama.
A children’s health insurance program would get a substantial funding boost next year to help cover higher enrollment. ALL Kids, which insures Alabama children whose low- and middle-income families do not qualify for Medicaid, would receive 28.3 percent more from the GF.
General Fund’s long-term structural deficit remains
Alabama is one of the only states with two major state operating budgets. The ETF budget funds K-12 schools, two-year colleges and public universities, as well as other state and local services related to education. The General Fund budget provides support for all other state services, including public health, public safety and child welfare.
Alabama has the highest rate of “earmarked” revenue in the nation. That earmarking forces lawmakers to spend certain tax proceeds only for very limited purposes. For example, individual income taxes and sales taxes are set aside for the ETF and can be spent only on education. Revenues from sales taxes and income taxes tend to rise and fall with the economy, allowing the education budget to make up for bad years during good years and to save some money for years when the economy is not doing as well.
The GF budget lacks this flexibility because it is funded from a variety of revenues that are not as responsive to economic changes and that do not grow quickly enough to keep pace with cost increases. That leaves the GF with a structural deficit, meaning it often is strapped for cash even when the economy is doing well. Next year’s proposed budget once again illustrates Alabama’s chronically inadequate funding for core services, ACPP executive director Kimble Forrister said.
Time is getting shorter for the Legislature to pass GF and ETF budgets for next year. Lawmakers will return Tuesday for the 17th of 30 allowable meeting days during the 2014 regular session, which is expected to last until early April.
By Carol Gundlach, policy analyst. Communications director Chris Sanders contributed to this report. Posted Feb. 20, 2014.
2014 legislative update: Anti-ACA bill clears Alabama Senate committee
A bill that purports to nullify parts of the Affordable Care Act (ACA) sailed through an Alabama Senate committee Wednesday with few questions. The bill now goes to the full Senate for consideration.
SB 220’s sponsor, Sen. Jerry Fielding, R-Sylacauga, told members of the Senate Judiciary Committee that he needed to pass the bill out of the committee Wednesday but said there would be a chance to make changes. “I have some changes myself,” Fielding said. “There will be opportunity for adjustments.”
The bill cites the Tenth Amendment to the U.S. Constitution in seeking to refuse to enforce sections of the ACA that “exceed the authority of Congress.” The measure does not specify all the parts of the ACA that are believed to exceed that authority. The U.S. Supreme Court upheld the ACA’s constitutionality in 2012.
Depending on how state officials would interpret the broadly worded SB 220 if it became law, enforcement might halt Alabama’s compliance with numerous technical provisions of the ACA, including new Medicaid eligibility requirements, information system upgrades and interagency data sharing. Disrupting such activities could jeopardize current federal Medicaid funding, ACPP policy director Jim Carnes said.
SB 220 would authorize the attorney general to file lawsuits on behalf of certain individuals or businesses “being harmed by implementation” of the ACA. The measure also would prohibit Alabama or any of its cities or counties from establishing a health insurance exchange under the ACA.
In addition, the bill would forbid state agencies and employees from conducting “involuntary” home visits under certain maternal, infant and early childhood programs referenced in the ACA. The ACA already requires that all such visits be voluntary. If SB 220 bars all in-home visits under that section of the ACA, the Department of Children’s Affairs could lose $6.3 million a year in federal grants, according to the Legislative Fiscal Office.
Committee member Sen. Phil Williams, R-Rainbow City, asked whether the bill’s passage could void certain insurance contracts already in force. Fielding said he would welcome a floor amendment to address that concern.
Identical legislation – HB 147, sponsored by Rep. Barry Moore, R-Enterprise – awaits action in the House Health Committee. The Legislature will return Thursday for the 16th of 30 allowable meeting days during the 2014 regular session, which is expected to last until early April.
By M.J. Ellington, health policy analyst. Posted Feb. 19, 2014.
2014 legislative update: Alabama Senate panel discusses plan to end state grocery tax, raise sales tax on other items
An Alabama Senate committee took no action Wednesday on a proposal to swap the state grocery tax for a higher sales tax on other items. The panel could vote next week on SB 287, sponsored by Sen. Gerald Dial, R-Lineville. Committee members heard public testimony on the bill Wednesday.
Dial’s bill would end the state’s 4 percent sales tax on groceries and increase the sales tax on other items by 1 percentage point to replace the lost education revenue. The bill would phase in the changes over four years and would not require a public vote.
By September 2017, the state sales tax on most consumer items would be 5 percent under the bill. Local sales taxes would be unaffected, but the combined state and local tax rate would rise to 11 percent in Birmingham and Montgomery. “It’s getting to be too big of a bite out of people’s wallets,” ACPP executive director Kimble Forrister told members of the Senate’s education budget committee.
SB 287 would negate many low-income Alabamians’ grocery tax savings by increasing the cost of everything else they buy, Forrister said. Items like clothes, toiletries and school supplies would be subject to a higher sales tax under the plan.
“We’re basically replacing one regressive tax with another regressive tax,” Forrister said. “The best way to approach a regressive tax is to balance it out with a progressive tax.”
Forrister commended Dial for drawing attention to Alabama’s status as one of only four states with no tax break on groceries. But a better way to replace the revenue from the grocery tax, Forrister said, is found in HB 130, sponsored by Rep. John Knight, D-Montgomery.
HB 130 would end the state grocery tax all at once and would repeal the state’s income tax deduction for federal income taxes (FIT). Only two other states offer a full FIT deduction, and the top 3 percent of Alabama taxpayers received more than half of its savings in 2011. Because the deduction is written into the state constitution, HB 130 would require voter approval.
Dial said HB 130 faces legislative opposition, including his own, and will not pass this year. SB 287 stands a better chance of becoming law, he said. “This is the only option out there to remove sales tax for food,” Dial said. “I know you can argue that shoes and clothes and toothpaste are a necessity, but not as much as food.”
‘It’s not going to help folks at the lower end’
SB 287 would boost combined receipts to the Education Trust Fund (ETF) and General Fund by $28 million a year, according to the Legislative Fiscal Office, but the bill would require the Legislature to re-examine its changes in 2018 to ensure they are revenue-neutral. Susan Kennedy of the Alabama Education Association urged Dial to remove that provision to avoid forcing future lawmakers to slash ETF funding. “Let the 2018 Legislature deal with that issue when it comes,” Kennedy said.
Sen. Hank Sanders, D-Selma, said Dial’s bill was “selective” in raising the state sales tax on many everyday consumer items but not on more expensive purchases like cars. “It’s not going to help folks at the lower end,” Sanders said. “If they miss ’em in the washer, they’re gonna get ’em in the ringer.”
Alabama’s tax system requires low- and middle-income families, on average, to pay twice the share of their incomes in state and local taxes that the richest Alabamians pay, according to the Institute on Taxation and Economic Policy. Sales taxes are the biggest driver of that gap, because low-income families must devote more of their household budget to food, clothes and other necessities subject to those taxes.
The Legislature will return Thursday for the 16th of 30 allowable meeting days during the 2014 regular session, which is expected to last until early April.
By Chris Sanders, communications director. Posted Feb. 19, 2014.
More than 15,000 Alabamians sign up for Marketplace health coverage in January
Enrollment in health plans through the Alabama Health Insurance Marketplace rose by more than 15,000 in January, for a four-month total of nearly 44,000, the U.S. Department of Health and Human Services (HHS) reported this week.
Alabama’s increases followed the trend of nationwide enrollments, which increased by 62 percent last month to a total of 3.3 million. The Marketplace, created in the Affordable Care Act and accessible at healthcare.gov, enables people to compare health insurance plans, learn about financial assistance for which they may qualify, and sign up for coverage.
“January’s enrollment numbers are great news,” ACPP executive director Kimble Forrister said. “Thousands of people in Alabama are getting access to affordable health coverage for the first time, and we expect those numbers to continue to grow in the months ahead.”
Many Alabama organizations offering enrollment assistance are planning intensive outreach activities between now and March 31, when the first open enrollment period ends. A statewide list of enrollment assisters, searchable by ZIP code, is available in the new Bama Guide at bamacovered.org, a student leadership initiative focused on health coverage enrollment.
Forrister said he was encouraged to see more young Alabamians obtaining health coverage through the Marketplace. About 27 percent of Americans who signed up last month were between the ages of 18 and 34. That share was up from 24 percent in December. Alabama's figures followed a similar trend.
Better timing for open enrollment in future years could make enrollment in the Health Insurance Marketplace easier, a national health policy expert said. “Given the cash flow pinch at the holidays, most lower- and middle-income consumers wait for their tax refund before they take on new financial obligations,” said Brian Haile, a vice president for health policy at Jackson Hewitt Tax Service who previously helped set up Tennessee’s health exchange.
In 2013, consumers wanting their Marketplace health insurance coverage to begin Jan. 1 had to sign up between Oct. 1 and Dec. 24. After early technical problems at healthcare.gov subsided, the December enrollment numbers far exceeded those of the first two months. But in a different season, the first half of the open enrollment period might have been stronger, Haile’s analysis suggests.
Haile said a better time for HHS to set future enrollment deadlines would be when lower- and middle-income people are likelier to have more money on hand. In January, people start getting their income tax refunds, and holiday spending is behind them. That means they are more able to focus on signing up for health insurance, Haile said. HHS is still considering dates for next year’s open enrollment period.
Health advocates are pushing to make sure Alabamians know they still can sign up for coverage by the March 31 deadline. People interested in more information on Marketplace plans can go to healthcare.gov or call 800-318-2596.
By M.J. Ellington, health policy analyst. Posted Feb. 14, 2014.
2014 legislative update: Alabama Senate panel OKs bill to lift lifetime SNAP, TANF bans for people with felony drug conviction
An Alabama Senate committee Wednesday approved a bill that would allow people who were convicted of a drug-related felony to regain eligibility for food assistance or cash welfare benefits. The Senate Fiscal Responsibility and Accountability (FR&A) Committee voted 5-2 to send the bill to the full Senate for consideration.
Alabama is one of just 10 states where people who were convicted of a drug felony face a lifetime eligibility ban under the Supplemental Nutrition Assistance Program (SNAP). Alabama is also one of only 12 states to apply a similar ban to benefits under the Temporary Assistance for Needy Families (TANF) program. The bans apply even to people with a lone offense decades ago.
SB 303, sponsored by Sen. Linda Coleman, D-Birmingham, would allow otherwise eligible people to receive SNAP and TANF benefits even if they have a prior felony drug conviction, as long as they have completed their sentence or are complying with their probation terms, including any court-ordered drug treatment.
It was clear during the lively committee discussion of SB 303 that many people saw unfairness in a policy that denies eligibility only to those convicted of a felony drug crime. “A person that rapes, robs or kills can come out [of prison] and receive SNAP,” Coleman said. “This bill just levels the playing field.”
Another Senate committee last month approved a proposal – SB 63, sponsored by Sen. Trip Pittman, R-Montrose – to require drug testing for TANF applicants who had drug convictions within the last five years. Several members of the Senate FR&A Committee asked whether Pittman’s bill would apply to newly eligible people under SB 303.
Both Coleman and a representative of the Department of Human Resources agreed that SB 63 would apply to TANF applicants, but they said federal law forbids drug testing as a condition of SNAP eligibility.
After a minor, uncontroversial amendment, the committee voted 5-2 for SB 303. Voting in favor were Sens. Paul Bussman, R-Cullman; Coleman; Del Marsh, R-Anniston; Bryan Taylor, R-Prattville; and Phil Williams, R-Rainbow City. Voting “no” were Sens. Rusty Glover, R-Semmes, and Clay Scofield, R-Guntersville.
The Legislature will return Thursday for the 14th of 30 allowable meeting days during the 2014 regular session, which is expected to last until early April.
By Carol Gundlach, policy analyst. Posted Feb. 12, 2014.
2014 legislative update: Bill to allow some pharmacies to redispense HIV drugs goes to Alabama House
Pharmacies that dispense HIV medications for or in HIV clinics would be able to redistribute certain unopened drugs under a bill that the House Health Committee approved unanimously Wednesday. HB 138, sponsored by Rep. Patricia Todd, D-Birmingham, now moves to the full House.
Current regulations prohibit HIV clinics from sending back medications, Todd said, even if patients do not show up for treatment. Clinic doctors say there are ample opportunities to use unclaimed, unopened drugs for other patients, but state regulations do not permit unauthorized redistribution of such drugs. Without the changes proposed in HB 138, pharmacies must continue to destroy those drugs.
Todd’s bill would allow pharmacies to redispense the medications to other patientsand would set strict control measures on handling and oversight of the drugs. State law already allows county jails and prisons to redispense unused prescription drugs and gives oncologists the authority to use unclaimed cancer drugs for other patients.
Arise and other consumer advocates last year urged Gov. Robert Bentley to support this policy change as his Medicaid Pharmacy Study Commission met to look at ways to reduce costs in the state’s Medicaid drug assistance programs. Advocates said the change would reduce waste and improve cost-effectiveness. Funding for most HIV medications comes from federal sources to the AIDS Drug Assistance Program at the state Department of Public Health.
The Legislature will return Thursday for the 14th of 30 allowable meeting days during the 2014 regular session, which is expected to last until early April.
By M.J. Ellington, health policy analyst. Posted Feb. 12, 2014.