Minnesota House of Representatives


State Representative Erin Murphy

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100 Rev. Dr. Martin Luther King Jr. Blvd.

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Posted: 2009-12-10 00:00:00
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Press/News Releases

Health Care Leaders Propose Temporary Solution to Restore GAMC

Builds bridge to national health care reform without raising taxes

ST. PAUL, MN – Almost immediately after the Governor’s veto of the General Assistance Medical Care program last session, lawmakers began working on a solution to preserve basic health care for vulnerable Minnesotans without increasing costs for budget-strapped middle income Minnesotans. Today, they unveiled a solution that would temporarily restore General Assistance Medical Care without increasing taxes.

“After spending the entire session trying to cut health care costs and implement strategic reforms into our health care system, I was frustrated by the Governor’s decision to eliminate a program that serves our most vulnerable Minnesotans and will only lead to increased health care costs for the state and its taxpayers," commented Senator Linda Berglin, chair of the Senate Health and Human Services Budget Division.

The Legislative solution will provide a short-term, lower-cost reformed GAMC program for sixteen months, from March 1, 2010 until June 30, 2011, serving as a bridge to national health care reform. The program will offer on-going access to basic care for those currently enrolled in GAMC, protect thousands of vital health care jobs, and restore the solvency of the Health Care Access Fund through 2012.

Funded entirely without new taxes, the solution relies largely on cost saving reforms, maximizing existing state and federal health care funding streams, and reduced provider reimbursement rates to pay for a pared down GAMC program. Rep. Erin Murphy (DFL – St. Paul), who leads a House working group to develop a GAMC solution, said they approached this problem in a practical manner, mindful of the challenges facing all Minnesota families.

“Restoring GAMC is in the best interest of all Minnesotans,” said Murphy. “Our solution maintains basic care for the sickest and poorest Minnesotans as well as protects middle income families who would otherwise see increases in their health care premiums.”

Since the session adjourned, lawmakers have met with numerous health care stakeholders to discuss the consequences of the elimination of GAMC and to help develop a solution. They toured nine hospitals throughout Minnesota and have met with health care providers, local governments, representatives of the faith community, safety net organizations, mental health advocates, and many others to discuss the issue.

“Minnesotans understand the cost of doing nothing is far too damaging to our economy. I want to thank these legislators for their work to truly reform GAMC," said House Speaker Margaret Anderson Kelliher. "This proposal is a step toward containing costs while preserving basic health care and jobs across our state.”

As a result of the elimination of GAMC, 70,000 Minnesotans, all who earn less than $7,500 annually, could lose coverage. About 80% of those served by the program have serious mental health issues. Kicking them off health care will increase expensive uncompensated care at Minnesota hospitals which drives up insurance premiums, force job cuts at hospitals, and increase homelessness and crime.

Elimination of GAMC will directly impact individuals like Al Phenow of Minneapolis. Al is a 60 year old, lifelong resident of Minnesota, having grown up in Osseo where his father served as mayor. Phenow has been a cement worker for most of his life. With the downturn in the economy, Al found himself unemployed and homeless. Phenow was able to qualify for housing assistance which helped him get off the streets and also qualified for medical care through the GAMC program.

“Without the GAMC program I would not be able to afford my medical bills or the care I need to treat my severe arthritis,” he said.

Other public health care programs, like MinnesotaCare, would not be appropriate for individuals like Phenow. The premiums and co-pays would be well beyond the $203/month he receives in income and loss of GAMC would jeopardize his ability to get the hip replacement he desperately needs to be mobile.

“Failure to fix GAMC in a meaningful manner is unacceptable,” said Berglin. “The consequence of inaction will have a damaging ripple effect throughout Minnesota’s health care system, economy, and society.”

This solution to restore GAMC starkly contrasts with the Administration directive to auto-enroll GAMC recipients to MinnesotaCare by March 1st. The November economic forecast revealed that such a short-term solution would bankrupt the Health Care Access Fund and would require $160 million to be diverted from the General Fund. The Governor’s proposal would also force hospitals to pay millions of dollars in uncompensated care that will get passed onto middle class families in the form of higher premiums and property taxes.

“This plan restores almost $300 million of the Governor's cuts to hospitals and providers, captures over $130 million in federal funds, focuses on individuals with chronic diseases where primary care has the greatest impact, and restores the Health Care Access Fund without shifting $160 million from the General Fund,” said Rep. Tom Huntley, (DFL - Duluth), chair of the House Health Care and Human Services Finance committee.

“Hennepin County Medical Center recently announced they are planning to cut up to 200 jobs and close two clinics, and just last week Regions Hospital announced they are indefinitely postponing plans to build a new behavioral health building,” said State Rep. Paul Thissen, chair of the House Health Care and Human Service Policy and Oversight committee. “This is completely contrary to our state's need to save jobs and create new ones. The joint House/Senate proposal, in contrast, will protect our institutions and Minnesota jobs and aid our economic recovery.”

In the coming weeks before session, lawmakers hope to continue working collaboratively with health care stakeholders and with the Governor and Republicans on a bipartisan solution.

“Everyone recognizes we need to do something,” said Murphy. “We still have some work ahead to reach consensus on a solution and this legislative proposal is an important first step in that process.”

The House Health Care and Human Services Finance and Policy committee will hold a public hearing on Monday, December 14th to discuss GAMC proposals.


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