January 28, 2005

Wednesday evening Governor Blunt gave the State of the State address outlining his budget and legislative initiatives for the first year of his term.

In a very tough message Blunt has recommended a $1.1 billion reduction in the state budget with approximately $400 million coming from General Revenue ad $662 million out of Medicaid.

Department Directors have been given the directive to reduce spending by 20% throughout the state but not necessarily in across the board cuts.

The Governor has also announced a 20-member commission to reorganize state government. This was last attempted in 1974 during Governor Bond’s first administration.

The governor proposed $896.1 million in cuts he said were needed to balance the state’s $19.4 billion fiscal year 2006 operating budget without increasing taxes. The cuts include:

• a $626 million reduction to the Medicaid Program (includes federal funds)
• $13.8 million in savings through a reduction in the state workforce of 1,017 positions and improved delivery of services through private providers
• $239.2 million in reductions to state departments (Elementary and Secondary Education along with Higher Education will be exempt from these cuts)
• $9 million in savings achieved through responsible debt management
• $8.1 million in savings through a reduction in the state workforce of 194 positions and closing the Department of Revenue’s motor vehicle licensing branch offices

While the work force would be thinned, the remaining employees would get a modest raise. Blunt recommends the state spend $25 million on a 1 percent cost-of-living raise for all employees except elected officials.

The Department of Health has been directed to reduce spending by $81 million in General Revenue.

The actual DOH budget has increased from $400 million to $800 million as a result of transfers from the Department of Education and Social Services.

Medicaid eligibility reductions proposed by Blunt immediately will force 49,000 individuals off Medicaid; an additional 41,000 will lose all benefits over the course of the new budget year. The proposed reductions are as follows:

• Medical Assistance for Families — adult eligibility cut from 75 percent to 30 percent of the federal poverty level
• elderly and disabled eligibility cut from 100 percent to the Supplemental Security Income limit of 74 percent of the FPL for singles and 80 percent of the FPL for married couples
• elimination of extended optional transition medical assistance for adults through the 1115 Waiver
• elimination of General Relief
• elimination of dental, podiatry, rehabilitation and specialty services for all eligibles except children, pregnant women and the visually impaired

Expanded fraud and abuse control initiatives are projected to save $75 million during the next fiscal year. The governor called for all Medicaid recipients to have an annual eligibility review. More details are expected to emerge as appropriation bills to codify Blunt’s proposals are introduced in the House of Representatives.

Senate Appropriations
On Monday, the Senate Appropriations Committee heard public testimony regarding the Department of Health.

This hearing is a preliminary measure, as the Governor did not yet submit the budget.

Ivah Scott presented testimony in support of restoring the core functions budget for DOH.

Tobacco Funding
The Governor has recommended $875,000 to initiate youth tobacco prevention programs.

Ron Cates, Interim Director of the Department of Health, indicated to me on Friday that this figure does not include the recent $7 million awarded in the lawsuit by the Attorney General’s office for subsequent tobacco manufacturers not included in the original Master Settlement Agreement.

See page 23 “Preventing Underage Smoking” of the Governor’s Budget. Shortcut to: http://www.oa.mo.gov/bp/bib2006/Healthy.pdf

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Core Funding
In a meeting with Ron Cates- Interim Director DOH, informed the MOALPHA board that “core funding” appropriations are intact at this point.

MOALPHA will need to keep our legislators informed on the importance of retaining this line item for our local public health agencies.

Below is a link to the DOH Budget. Shortcut to: http://www.oa.mo.gov/bp/budg2006/HSS.pdf

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Lead Testing
Senate Bill 7 , Senator Dougherty, was heard on Wednesday in the Senate Public Health Committee.

SB 7 modifies the law relating to lead abatement and lead poisoning.

A one dollar check-off on the Missouri income tax return is created and the money designated by the check-off will be deposited into the Childhood Lead Testing Fund. The check-off of one dollar is primarily for taxpayers who are to receive a refund. However, taxpayers who owe taxes may also contribute to the fund and any taxpayer may elect to contribute more than one dollar (Section 143.603).

The Department of Health and Senior Services shall provide on its Internet website educational materials that explain the rights and responsibilities of the property owners, tenants, lead inspectors, risk assessors, and lead abatement contractors (Section 701.305).

Section 701.306 clarifies that written notification shall include options that are appropriate for reducing lead hazards.

Representatives of the Department, local government or health departments have the authority to re-enter a dwelling or a child-occupied facility to determine if the required actions have been taken. If the representative does not have consent to enter, they may petition the court for an order to enter the premises. An order shall be granted upon a showing that the representative attempted to notify the dwelling's owner in writing and forty-eight hours in advance of the time and purpose of the re-entry (Section 701.308).

Any lead abatement contractor that fails to notify the Department prior to starting a lead abatement project will be fined two hundred and fifty dollars for the first identified offense, five hundred dollars for the second identified offense, and thereafter fines will be double for each identified offense. The lead abatement contractor shall inform the owners and tenants of a dwelling that information regarding potential lead hazards can be accessed on the Department's internet website. Once the abatement has been completed, the lead abatement contractor must submit written notification and the final clearance inspection report to the Department (Section 701.309).

The Director shall require lead abatement contractors to purchase and maintain liability insurance. Licensees or applicants for licensure must provide evidence of their ability to indemnify any person that may suffer damage from lead-based paint activities to which they may be liable. The licensee or applicant for licensure may provide proof of liability insurance in an amount to be determined by the Department, which shall not be less than $300,000 dollars (Section 701.312).

Injunctions may be brought by the Department or the Attorney General in Circuit court until substantial compliance with sections 701.300 to 701.338 is achieved. All actions may be placed at the head of the docket and hearings shall be held within fifteen days of filing. Individuals cited with a violation of sections 701.300 to 701.338, by clear and convincing evidence, shall be fined up to one thousand dollars for the first violation and five thousand dollars for subsequent violations. The fines shall be deposited into the “Missouri Lead Abatement Loan Fund” (Section 701.317).

Current law specifies that any violation of sections 701.308, 701.309, 701.310, 701.311 and 701.316 is a Class A misdemeanor. New language states that any subsequent violation of these sections will be a Class D felony (Section 701.320).

Next Week
The House Committees will finally begin hearings on the legislation filed thus far. Approximately 400 bills have been filed at this juncture. Typically, 2000 bills will be filed by the cut-off date for filing on March 1 st.

The budget is now submitted and the House Budget and Senate Appropriations Committees will begin the difficult task of analyzing the Governor’s proposals.

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