State Budget Update

VHCA (2/19/2010)

This Sunday, the Virginia House and Senate each report out their versions of the state budget.  As previously reported, the General Assembly and the Governor are working to identify additional expenditure cuts of approximately $2 billion to balance the budget.  On Wednesday, Governor McDonnell announced his recommendations for achieving the additional cuts. 

While we are guardedly optimistic that additional cuts to Medicaid payments to nursing facilities were not included in his recommendations, providers must keep in mind that these are his recommendations only and that the decisions on how to balance the budget rest with the two chambers of the General Assembly.  Governor McDonnell’s recommendations included $300 million in additional cuts to health and human resources programs including significant cuts to Medicaid home and community based services programs.

In December, outgoing Governor Tim Kaine introduced his budget for the 2010-2012 biennium that eliminated $25.2 million in Medicaid funding in state fiscal year 2011 for nursing facility inflation and cost ceiling rebasing adjustments.  This proposed cut is virtually certain to remain in both spending plans being unveiled on Sunday.  The 2011 proposed cut is in addition to Medicaid reductions totaling $47 million for 2009 and 2010.  VHCA members are encouraged to continue contacting their legislators about the challenges of providing care to Medicaid beneficiaries after three years of significant cuts.  VHCA will update members on Monday about Sunday’s Senate and House budget announcements.