It's the chief reason why odd year sessions of the Kentucky General Assembly were instituted ten years ago, to address budget shortfalls and other critical legislation. Yet, Democrats and Republicans remain far apart on how to fill a $166 million gap in the state's Medicaid budget.
On Tuesday, a Kentucky Senate committee proposed an across-the-board cut of state government, rather than Governor Steve Beshear's plan to take an advance on next year's Medicaid budget to cover the shortfall. The Democratic House has approved the Beshear proposal. The leader of the Republican Senate, David Williams, is advancing the budget cut plan.
The Lexington Herald-Leader's Beth Musgrave has Beshear's reaction:
“It’s clear this proposal has been engineered to fit campaign rhetoric, not sound public policy,” Beshear said. “Sen. Williams’ version mandates further painful and unnecessary cuts across a broad spectrum of services, including K-12 education, higher education, public safety and job creation. These cuts are not necessary when a viable alternative is available.”
The Courier-Journal's Tom Loftus explains Beshear's reasoning for shifting $166.5 million from 2012 Medicaid to 2011 Medicaid:
That would allow the state to take advantage of a higher federal match rate this year for state funds spent on Medicaid, the health care program for the poor and disabled.
Under Beshear's proposal, the hole in 2011-12 budget would be plugged through savings achieved by “managed care” initiatives in delivering Medicaid services.
But Williams said that those savings next year are illusory, and that serious future budget complications will arise if those savings are not achieved.