State governments expect tax collections to grow but still face budget gaps

Jul 28 2010

The Wall Street Journal: "State governments expect tax collections to grow for the first time in two years as tax increases and a recovering economy lead to higher collections. But states are still likely to face at least two more years of financial troubles and about half will see gaps in this year's budgets if Congress doesn't extend special Medicaid payments that were part of the 2009 stimulus act, according to a report expected to be released Tuesday by the National Conference of State Legislatures. Forty-one states had budget gaps going into the 2011 fiscal year that started this month, but almost all of them have been closed through a combination of budget cuts and tax increases" (Dougherty, 7/27).

Kansas Health Institute: "Last week, the Kansas Health Policy Authority announced a Medicaid reimbursement policy change that is expected to benefit many, if not most, Kansas school districts. ... But the small school [in Paola] at Lake Mary Center, a facility that specializes in care of severely disabled children drawn from across Kansas, comes out a big loser with the new rules and now school and state officials are scrambling to figure out how to deal with that problem. … The Lake Mary Center school has an annual budget of about $3 million, said [Bill Craig, Lake Mary's president,] and about $500,000 of that will no longer be covered by Medicaid as the result of the rule changes, which were announced with little notice last week and became retroactively effective July 1" (Shields, 7/26).

The Augusta (Ga.) Chronicle: "The city's health care premiums will balloon 37 percent in 2011 to $25.7 million, a $7 million increase over this year's premiums for the same coverage, according to the city's employee benefits consultants, Benalytics of Marietta, Ga. To reduce the increase, the commission was advised in a work session Monday to seek requests for proposals from insurance companies nationwide, with changes in plan design to include multiple options. The second cost-cutting proposal would allow Human Resources Director Rod Powell to design a long-term strategy to address the causes of and remedies to the skyrocketing premiums, possibly including targeting specific illnesses" (Cooper, 7/26).

The Associated Press/Kansas City Star: "Opponents of the new federal health care law have started running radio ads encouraging people to vote for a Missouri ballot measure next week. The ballot measure sets up a conflict with a federal law requiring most Americans to have health insurance or face fines by 2014. The Missouri measure would prohibit governments from requiring health insurance or penalizing people who pay for their own health care" (7/26).

Los Angeles Times: "Los Angeles Mayor Antonio Villaraigosa and his top budget advisers thought they negotiated a labor contract last week that would begin to address the steadily rising cost of employee healthcare benefits. But that deal, reached with the 4,800-member Engineers and Architects Assn., has come under attack from members of another civilian employee union, which contends that the agreement contains 'unprecedented and dangerous' concessions and should be rejected. With the Engineers and Architects voting on the tentative agreement this week, organizers with Service Employees International Union Local 721 have begun warning that the proposed pact is part of a larger effort to 'divide and conquer' the city's civilian employee groups" (Zahniser, 7/27).

Lawrence Journal-World & 6 News: "The biggest issue facing the Kansas Insurance Commissioner race is how each candidate plans to address the Health Care Reform [a]ct. On Aug. 3, two-time insurance commissioner Sandy Praeger will face David Powell of El Dorado who has 33-years of experience in the insurance business. With no Democratic challenger, the winner of the Republican primary will be left to make sense of how to implement the legislation ... much of which is slated to go into effect in 2014" (Metz, 7/26).

Detroit Free Press, on the creation of a high risk pool in Michigan: "Priority Health of Grand Rapids, a subsidiary of Spectrum Health, will provide coverage to 61 Michigan counties, and Physicians Health Plan of Mid-Michigan, a Lansing subsidiary of the Sparrow Health, will run the pool in 22 others. The winning bids were announced Monday by the Department of Management and Budget, which oversees bidding for state contracts. Consumers younger than 65 who are not insured and who have been rejected by a health plan because of a chronic health problem can apply for the coverage beginning Sept. 15, with coverage to begin by Oct. 1" (Anstett, 7/27).

The Salt Lake Tribune: "The insured make up 40 percent of the people who qualify for financial assistance at the [University of Utah hospital]. And at Intermountain Healthcare, the state's primary provider of charity care with 22 nonprofit hospitals, they make up nearly half — 47 percent — of charity cases. Their numbers have been inching up because they can't afford ever-increasing deductibles and co-payments that employers are passing on to their employees, according to hospital administrators. And that suggests that health care reform — and the 2014 requirement that citizens and legal residents have health insurance — won't do much to reduce the demand on free or reduced-cost care" (May, 7/26).