Latest round of state cuts not sensible
As the state works to absorb the impact of an economic slowdown, in early September Gov. Strickland announced a 4.75 percent spending cut at most state agencies, while also limiting cuts in several other areas of the budget.
I appreciate the governor’s efforts to maintain a balanced budget, while protecting important state programs. At the same time, I have observed through three administrations now that, when faced with budget cuts, state agencies often try to maintain their agenda and sometimes at the detriment of Ohio taxpayers.
For example, I believe the administration is being penny wise, but pound foolish in this latest round of budget cuts, by limiting senior citizen enrollment in the state’s assisted living waiver program. As you may recall, in 2005, I worked with stakeholders to establish the Home First program, which provides a state waiver to senior citizens in a nursing home facility, who could be better served at home. Since the program began, hundreds of people have opted for this choice, saving Ohio taxpayers millions of dollars and giving our seniors the opportunity to choose the best setting for their health care needs.
Now, because of the executive order, the Department of Aging is limiting enrollment in assisted living to 64 patients per month statewide. This makes no sense. While this move may look like a cut on the Department of Aging’s balance sheet, it could end up costing the state millions of dollars more in the long-run. According to the Ohio Assisted Living Association, the maximum assisted living Medicaid waiver costs $2,100, while the average monthly cost for nursing home care is $5,000. Not to mention, the popularity of the assisted living waiver program is growing. Enrollment for July, August and September of 2008 was 86, 82 and 100 people respectively, compared to 28, 35 and 29 people at the same time last year.
In some instances, state agencies may say they are cutting their budget, but raise fees or tap other revenue sources to make up for any cuts. For instance, during the most recent Controlling Board meeting, the Attorney General’s office testified that all of their “cuts” have been replaced entirely by revenue from increased fees and other sources. This is not necessarily a bad thing, but it is something that we should be aware of when considering next year’s budget.
Recently, I learned that the Ohio Department of Jobs and Family Services has a surplus in its Medicare Part D account at the same time they are asking the General Assembly to tap the Rainy Day Fund to help offset shortfalls in Medicaid funds. If ODJFS had used these extra funds from the Medicare Part D account to cover Medicaid expenses, as the law allows, it would eliminate the need for resources from the Rainy Day Fund.
During negotiations on the most recent state budget, the Strickland administration agreed to $300 million in cost containment savings from Medicaid, but this has yet to happen. Unfortunately, ODJFS has not turned around its operations to meet the budget expectations of the Legislature or the general public.
I would like to say that there are many state agencies and state employees trying to do the right thing. However, I believe it is important to shed light on these issues to help promote the best use of taxpayer dollars.