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Budget Bills
Move Through The Sausage Maker
MIRS, September 9, 2004
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The House and
Senate churned out the bulk of the Fiscal Year (FY) 2005 budget
today and dealt with several other meat-and-potato bills
necessary to cement the spending plan for the fiscal year that
starts in just over two weeks.
Beginning in the Senate, the following is a brief run down on
the [school/child related] budgets and related legislation.
Foster Care Agencies Get A Bump:
Foster care and adoption agencies received a 3 percent state
increase and foster care and adoptive parents are getting a 1
percent increase as part of the $4.29 billion Family
Independence Agency (FIA) budget that passed the Senate
unanimously today. A federal fund increase of 12 percent allowed
the state to take care of a rising caseload of folks needing
government assistance.
The agreement on the FIA budget also contains adoption subsidies
savings of $12.3 million and a permanency placement initiative.
It also requires the FIA to contract with private firms in the
name of efficiency. Sen. Bill HARDIMAN (R-Kentwood), chair of
the Senate Appropriations FIA subcommittee, put his stamp on the
budget by winning $250,000 in federal TANF money for fatherhood
initiatives and another $200,000 in federal TANF money for a
marriage initiative.
Another $500,000 in TANF money is being set aside for community
service block grants.
Sen. Hansen CLARKE (D-Detroit) said the budget doesn't address
the needs of the state's neediest people as much as the
governor's original proposal. But since an agreeable compromise
was reached on the children's clothing allowance issue and the
budget recognizes the value of children being taken care of by
their parents, Clarke said he found the budget agreeable.
The bill now goes to the governor for approval.
School Aid Budget:
Today the House approved, 99-8, the Conference Committee
recommendation on SB 1069, a $12 billion ($165 million GF/GP)
2004-05 School Aid budget that includes 20j funding for the 22
(mostly wealthy) schools that had previously faced a $6.6
million cut in what they'd expected.
After initial reaction to the potential cuts, Gov. Jennifer
GRANHOLM and lawmakers agreed to restore the funding and now
have a plan to make up the $6.6 million through property sales
instead.
For more detail see MIRS Sept. 7 edition. The bill now goes to
the governor for approval.
Higher Ed Budget:
With a 105-0 vote, the House passed SB 1067, a $1.69 million
($1.6 million GF/GP) Higher Education budget for Fiscal Year
2004-05 (see related story).
The bill now goes to the governor for approval.
DCH Budget:
With a 91-15 vote, the House passed SB 1063 today, a $10 billion
($2.5 billion GF/GP) Department of Community Health (DCH) budget
for FY 2004-05.
The bill includes a reduction in the dispensing fee Medicaid
would pay to pharmacists for dispensing prescriptions. The
dispensing fee cut of 34 percent was put forward by Gov.
Jennifer GRANHOLM in her budget-cutting proposal.
Currently, pharmacies are paid a $3.77 per prescription
dispensing fee. Under the conference report that will be sliced
to $2.50 — a rate the administration argues is more in line with
what private insurers pay.
The change is expected to generate $7.7 million in savings.
Pharmacists however, have been arguing the cut would give
Michigan the lowest Medicaid reimbursement rate in the country
and lead to local layoffs.
Other highlights of SB 1063 include:
- The budget reflects the consensus Medicaid base as agreed to
in May, an increase of about $100 million General Fund over
Granholm's original recommendation.
- The budget includes $14 million in General Fund pharmacy costs
(dispensing fee plus co-pay and mail-in pharmacy).
- The budget increases Healthy Michigan Fund prevention
programming by $12.3 million. Highlights of that include an
additional $110,000 for Alzheimer's disease outreach and
education, an additional $1.5 million for smoking prevention, $1
million each for lead poisoning prevention and infant mortality.
- The budget restores Medicaid podiatric, chiropractic, and
hearing aid services and increases payments to local public
health dental clinics.
- The budget rejects Granholm's proposal to make most Graduate
Medical Education payments through Medicaid HMOs.
- The budget reduces the Medicaid emergency room rate, saving
$1.5 million, down from a $3 million cut originally supported by
the administration and the Senate.
- The budget adds a new $5 million disproportionate share
hospital (DISH) pool targeted to unaffiliated hospitals and
hospital systems which received less than $900,000 in DISH
payments in 2004.
The bill now goes to the governor for approval.
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