Both savings, spending measures differ in HHS omnibus bills

Both the House and Senate omnibus health and human services bills contain cuts intended to rein in spending, but they differ in how much should be cut and where.

Sponsored by Rep. Matt Dean (R-Dellwood) and Sen. Michelle Benson (R-Ham Lake), HF945/SF800* was passed 36-30 by the Senate April 3 before it was amended and passed 74-53 by the House four days later. A conference committee began working to resolve the differences last week.

The House plan proposes $14.32 billion in spending during the 2018-19 biennium, a $620.95 million cut from current spending, while the Senate version contains $333.07 million in cuts. In stark contrast, Gov. Mark Dayton has called for a $328.04 million increase to current spending levels.

During a conference committee meeting April 19, Sen. Jim Abeler (R-Anoka) said that while many legislators support programs that Dayton proposes to fund, they can’t justify doing so through his proposed reinstatement of a 2 percent tax on medical providers.

Neither the House nor Senate would fund the $7.89 million operating adjustment recommended by Dayton. Without the funding, the Department of Human Services would struggle to meet state and federal requirements, much less implement new initiatives, said Commissioner Emily Piper.

Health Commissioner Ed Ehlinger said that while the legislative proposals fund valuable new public health programs, it does so by cutting existing public health activities.

Financial Differences — Savings

The Senate offer would chalk up most of its savings to provisions that delay payments, including measures that would shift $227.92 million in Medical Assistance costs from Fiscal Year 2019 to Fiscal Year 2020. Other delays would save $15.41 million in the 2018-19 biennium by putting off an update to inpatient hospital rates until July 2021 and $7.74 million by delaying the payment of local public health grants until the Fiscal Year 2020.

The House proposes a payment delay, as well, in Medical Assistance managed care payments, which would shift $135 million in costs from Fiscal Year 2019 to Fiscal Year 2020, however, the move comprises a smaller percentage of the House’s overall projected savings than the Senate.

The House bill also would save:

• $170 million by making sure MA benefits only go to eligible recipients;
• $154.61 million through health care delivery system pilot projects;
• $150.94 million by removing forecasted inflation for the MA program;
• $50 million in changes to competitive bidding;
• $40 million by ending funding for the operation of MNsure and Department of Human Services contributions to shared technology platforms; and
• $123,000 through increases to Minnesota Care premiums.

The Senate bill also expects to save:

• $27.98 million through a reduction in provider rates;
• $19.69 million through reduced funding for Department of Human Services’ central office operations;
• $14.13 million through integrity modifications to the state’s child care assistance program;
• $1.69 million through a reduction in supplementary service rates in the Group Residential Housing Program;
• $464,000 by expanding the Surveillance and Integrity Review Section at the Department of Human Services and expanding child care financial fraud and abuse investigations;
• $90,000 by instituting fines for maltreatment in DHS-licensed facilities; and
• $30,000 by eliminating home care nursing interpreter-communication services.

Financial Differences - Spending

While the House and the Senate agree to spend money on many of the same proposals, how much they plan to spend doesn’t always coincide.

For example, the proposals differ on how they intend to reduce service fees to parents of children who are disabled. The House proposes a 25 percent reduction, costing $3.52 million, while the Senate proposes a 13 percent decrease, costing $1.03 million.

The Senate plan to implement a value-based reimbursement system for nursing facilities totals $2.97 million and aligns more closely with the governor’s $3.17 million plan. In contrast, the House proposes $1.43 million in modifications.

Still other provisions only receive funding in one of the two plans:

In the Senate version:

• $3.44 million to provide a rate increase for complex services provided by personal care assistants;
• $3.11 million to fund an incentive pool for home and community-based services;
• $3.09 million to modify the Elderly Wavier program;
• $2.25 million to increase at-home infant child care assistance;
• $1.38 million to fund a $13/month increase in cash assistance for families in the Minnesota Family Investment Program, though the program is expected to save $62,000 over the 2018-2019 biennium; and
• $1 million to upgrade Direct Care and Treatment’s security system and electronic monitoring;

The House version would provide:

• $11.79 million to modify the basic sliding fee child care assistance program;
• $7.58 million to modernize pharmacy reimbursement, ensuring federal compliance;
• $4.16 million to provide school-linked mental health grants, allowing students to receive early intervention and care at their schools;
• $3.25 million to provide long-term homelessness support services, housing for mentally ill adults, transitional housing and emergency shelters;
• $2.92 million to transition Minnesota onto the federal insurance marketplace, allowing for the elimination of MNsure, the state’s marketplace;
• $2 million in mobile food shelf grants and $1.13 million in food shelf grants;
• $1.5 million to provide early treatment and support to people with schizophrenia during their first psychotic episodes;
• $1 million to provide start-up grants for integrated health partnerships;
• $314,000 in family foster care liability insurance;
• $162,000 to repeal radon licensure;
• $154,000 to establish an Alzheimer’s disease working group; and
• $71,000 to expand and clarify abortion data reporting.