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Articles of Interest - Michigan News

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Bridges4Kids LogoMichigan Senate Subcommittee Makes Huge General Fund Increase in DCH Budget
Gongwer News Service, March 18, 2004
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Making major budgetary changes in the Department of Community Health budget, SB 1062, the Senate Appropriations Community Health Subcommittee upped the general fund portion of Governor Jennifer Granholm's proposal by nearly $500 million.

The budget, reported to the full committee on a 4-2 party line vote, adds the huge increase by not assuming any position on the governor's proposed tobacco tax increase or the proposed decoupling of the state estate tax from the federal tax. That then assumes that up to $513.4 million will not be placed in the Medicaid Benefits Trust Fund to supplant the general fund.

It was just one of several major budgetary decisions, which included restoring all Medicaid adult dental, chiropractic, podiatric and hearing aid services by dumping Ms. Granholm's proposed increases in the Healthy Michigan Fund.

The budget also limits contracts on Medicaid health maintenance organizations to just one year and requires the state to study alternatives to the Medicaid HMOs, which could include returning to fee for services or creating a primary care case management arrangement.

And the budget requires the state contract with an outside firm, for $1 million, to "find Medicaid overpayments", which the subcommittee assumed would total some $5 million.

The budget, the second largest after the state's school aid budget, totals $9.74 billion, down some $60 million from Ms. Granholm's proposal. The general fund portion, at $2.974 billion, is $498 million more than the governor's proposal and the local revenue section of the budget was slashed $394 million from Ms. Granholm's proposal to $456.1 million.

Sen. Tom George (R-Portage), the only physician in the Legislature, said restoration of the supplemental Medicaid services could save the state emergency room costs since research indicates good dental care is more critical than initially thought in maintaining good overall health, and podiatry services could be critical to diabetics who must take particular care of their feet.

The budget also creates a new system for making payments to so-called "disproportionate share hospitals" that see large numbers of Medicaid patients, typically urban hospitals. The budget creates two funding pools, the first totaling $40 million that would pay eligible hospitals eight-ninths of what they were paid in the 2003-04 budget, and the second pool of $5 million would go to hospitals that received less than $900,000 in the disproportionate payments in the 2002-03 fiscal year.

And like most other budgets approved by Senate subcommittees so far, the budget cuts travel for the department by banning any expenditures for travel outside the state and requiring the department to spend half on travel in 2004-05 what it did in 2003-04.
     

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FIA Budget Prepped For Movement
MIRS, March 17, 2004

The House Appropriations Department of Human Services Subcommittee today reviewed a draft $4.3 billion budget that is expected to be reported to the full Appropriations Committee on Thursday.

As presented, the House version comes in at $4.306 billion, down from Gov. Jennifer GRANHOLM's recommended funding level of $4.336 billion. Of that, $1.35 billion is General Fund under the House plan.

The plan provides for $28 million less in federal funds and $2.6 million less General Fund funds.

Among program caseload spending increases, the Fiscal Year 2005 budget calls for:

- Child Day Care $36.1 million
- Family Independence Program $21.7 million
- Adoption Subsidy $18.4 million
- Foster Care $11.5 million
- State Disability Assistance $2.9 million

The House version also reduced Child Day Care caseload spending increases by $17.8 million and the Adoption Subsidy increase by $12.3 million to $7.1 million.

Other key changes to the governor's recommendation include:

- Clothing allowance, the budget includes $1.2 million in Temporary Assistance to Needy Families (TANF) dollars to increase the clothing allowance to $50 per child, but does not expand the program to include children from 0-3 years of age as recommended by the Administration.
- House included $6 million ($2.4 million general fund) to provide for a 4 percent rate increase for both foster care and adoption child placing agencies and residential facilities and adds $1.0 million $500,000 general fund, for specialized foster care.
- Included $5 million in TANF funding for a state-wide Before and After School Program.
- Added $200,000 to restore the Individual Development Account Program, $100,000 to begin a Fatherhood Initiative Program, and $100,000 to begin a Marriage Initiative Program, using TANF as the funding source.
- A $10 million savings anticipated in Day Care Services due to increased fraud detection and improved processes with three Inspector General Agents added specifically for fraud detection.
- A combined $434,500 cut in four Contractual Service, Supplies and Materials (CSSM) line items.
- Language to allow nationally accredited child welfare services agencies to conduct their own staff training based on the Department's policies and procedures for an anticipated savings of $432,300.
- The addition of one FTE to assist with cases under the Michigan Children's Institute.

The cuts to the CSSM lines and the training reduction are two items that the Department is concerned with and working on. Rep. Jerry KOOIMAN (R-Grand Rapids) said the bill was expected to be finished today and that the panel will consider amendments Thursday during a noon hearing.
     

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FIA Budget Moves To Full House Approps
MIRS, March 18, 2004

After unanimously adopting 10 amendments, the House Appropriations Department of Human Services, without discussion or debate unanimously approved a $4.3 billion budget that is $38 million below Gov. Jennifer GRANHOLM's recommendation.

Included in the amendments were replacing $2.3 million of General Fund money with TANF funds in the Day Care Services section of the budget recognizing a reduction in need for federal matching funds.

There was also an adjustment in the Day Care budget to reflect $20 million in savings from fraud detection and process improvements and allocating the savings to TANF.

Funding for an additional Inspector General Agent for Day Care fraud detection was put into the budget, as was an additional $650,000 in TANF for Community Action Agencies. Finally, the committee appropriated $78,500 of TANF money for a school-based crisis intervention demonstration project in Pontiac.

For details of major changes in the House version of the FIA budget see the Wednesday, March 17 edition of MIRS.

Although Rep. Jack HOOGENDYK (R-Portage) voted to "move the process along," he was critical of the budget.

Citing what he said was a $32 million increase in the General Fund portion of the budget over the current year, he told his colleagues, "As far as I'm concerned we're blowing a hole in the budget because we don't have the money."

Committee Chair Jerry KOOIMAN (R-Grand Rapids) called the budget "fiscally prudent" and one that addresses fraud problems.

Appearing to take issue with Hoogendyk's comments, Kooiman said there is a $5 million reduction in the General Fund portion of the budget and that $23 million of the money Hoogendyk referred to as an increase "is a transfer into the FIA budget of existing programs from another agency."

Noting that some things might have been written differently, Minority Vice Chair Chris KOLB (D-Ann Arbor) said the budget has lots of good things in it.

"There are lots of needs in this state and this budget begins to address those needs by helping the most needy in our state," Kolb said.
     

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Kuipers: Scrap MEAP In High Schools
MIRS, March 17, 2004

The controversial MEAP exam may be headed for the scrap heap with the introduction of legislation next week to replace it with a new test.

Sen. Wayne Kuipers (R-Holland), chair of the Senate Education Committee, confirmed today he will advance a five-bill, bi-partisan package to do away with the high school portion of the Michigan Education Assessment Program (MEAP).

"I think if I had to vote myself right now, I would probably lean at the high school level, yes -- let's explore a different option. MEAP has had problems," Kuipers said.

Segments of the state's education community want to replace MEAP with the ACT, but the Kuipers' proposal does not name a specific replacement, rather leaving the door open for other national testing companies to make a pitch, as well.

The Michigan Education Alliance (MEA) recently submitted a report to Kuipers on the advantages of making the switch. Jim Ballard of the Michigan Association of Secondary School Principals originally argued the move would save money, but now he and Kuipers concede it may be a wash for the state.

The Department of Education believes it would cost significantly more.

Nonetheless, Kuipers argues the idea should still be pursued because it will save money for parents who are now paying for the ACT exam as their children prepare for college.

Kuipers told a meeting of the Detroit Federation of Teachers (DFT) on Tuesday that the ACT would get the test results back into teacher's hands within three to five weeks not the six to eight months it takes to score MEAP.

The DFT teachers unanimously applauded the proposal shift, but the results at another education conference on Wednesday were different.

About 400 school board members and school superintendents meeting in Lansing were asked to applaud if they wanted to get rid of MEAP. About half voted yes the other half no.

"I was surprised," reflects Kuipers who heard the results. But he reports the public will have a chance to check in on the issue as a series of hearings is held.

"We believe that the Legislature here in Michigan will weigh in on the issue. We're trying to do this in a bi-partisan fashion. At the end of the day we'll see if there is support for it and whether the governor will sign it."

Gov. Jennifer Granholm said two weeks ago she was "listening" to the debate and had not made a final decision. The State Board of Education tells the governor to leave the test alone.

Dr. Herb Moyer was in the audience at the Wednesday conference and told MIRS afterwards that the MEAP "has gotten some bad press, but I think all in all, we should maintain it with some tweaking."

(Contributed by Senior Capital Correspondent Tim SKUBICK).

    

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