Kaiser Daily Health Policy Report Highlights Budget Developments in Three States

Summaries of recent news coverage about the state budgets of Maine, Maryland and New Jersey appear below.

• Maine: Gov. John Baldacci (D) last week proposed cuts to the state's two-year general fund budget that would address a $190 million shortfall in part by eliminating prescription drug coverage for Medicaid beneficiaries who have annual incomes up to 100% of the federal poverty level and have no children living at home, the Portland Press Herald reports. The proposal would eliminate drug coverage for more than 18,000 beneficiaries and save the state about $7 million, according to the state Department of Health and Human Services. Baldacci also has proposed requiring about 5,600 Medicaid beneficiaries to contribute an annual $25 enrollment fee (Carrier, Portland Press Herald, 3/10).
  
  
• Maryland: The Maryland Senate on Wednesday gave preliminary approval to a state budget that includes about $315 million in cuts and spending transfers -- some related to health care, the AP/Washington Times reports. The budget would delay until Jan. 1, 2009, a Medicaid expansion that was approved by the state Legislature last year. The budget also would scale back the small-business subsidy program that was part of the Medicaid measure. Both changes will save the state about $24 million. The Senate bill also would cut $20 million from the general fund for inpatient hospital costs (Witte, AP/Washington Times, 3/13).
  
  
• New Jersey: Gov. Jon Corzine's (D) proposed fiscal year 2009 budget would reduce charity care funding to hospitals by $108 million to $608 million and reformulate the way hospitals receive such funding, state health officials said on Monday, the Bergen Record reports. Under the new formula, hospitals would be classified into three different tiers based on the percentage of care provided to the uninsured. The formula also would take into account total revenues at each hospital. Betsy Ryan, CEO of the New Jersey Hospital Association, said that in addition to charity care cuts included in the budget, the state also would shift $35 million from charity care to a new health care stabilization fund, which would bring the total loss in charity care funding to $143 million. However, New Jersey Health Commissioner Heather Howard said most of the money from the stabilization fund would go toward hospitals, possibly to extend clinic hours for the uninsured and low-income patients and provide more services (Layton, Bergen Record, 3/11).