Pawlenty's budget fix may take 'last dime' of enrollees in public health-care program

For some months numerous poor people covered by the endangered General Assistance Medical Care (GAMC) program have testified at legislative hearings that they would be hard-pressed to keep up with insurance premiums as well as co-pays for office visits and prescriptions if they were switched to a program called MinnesotaCare.

In recognition of the difficulty, the Minnesota Department of Human Services decided that counties would be responsible for the first six months of their premiums on MinnesotaCare.

But now some impoverished adults without children are in danger of losing $203 in monthly General Assistance, which covers basic necessities like clothing, toiletries and minimal GAMC co-pays.

In an attempt to cover the state's burgeoning deficit, Gov. Tim Pawlenty on Monday released his supplemental budget proposal [Page 15, PDF], which eliminates the General Assistance monthly grant program as part of $347 million in cuts to the health and human services budget. Small grants will be available but only in emergencies.

"The governor is eliminating these people's last dime," said House Assistant Majority Leader Erin Murphy, DFL-St. Paul. "I think that we are seeing in black and white the values embodied in this administration. I believe Minnesotans have a different perspective on the care of people struggling in life."

If GAMC enrollees who now rely on that monthly aid are left penniless (about half of enrollees got the aid this month, according to DHS figures), how will they be able to meet the obligations of MinnesotaCare? What is the administration's plan to cover these costs?

Response No. 1 from DHS spokeswoman Beth Voight via email: "The department cannot speculate on how clients will cover expenses due to the many variables involved."
 
Response No. 2 from DHS spokeswoman Karen Smigielski via email: "Enrollees are responsible for co-pays, but the collection is up to individual providers. Under current state law, if an adult client of state-funded MinnesotaCare cannot afford to pay the co-pay at the time of visit, the provider must provide services. They must also inform the client of their debt and give them the opportunity to pay using standard office policies and procedures."

No response was received from Brian McClung, the governor's spokesman.

"I feel like wearing black," said Tracy Berglund, director of housing and emergency services for Catholic Charities of St. Paul and Minneapolis, which assisted 23,000 impoverished people last year. "How can we keep doing this to poor people?"

Legislature working on GAMC funding
Last week, the DFL-controlled Senate passed a bill to create a slimmer version of GAMC and to reform some practices such as unnecessarily long hospital stays for psychiatric care. The DFL-controlled House of Representatives is scheduled Thursday to take up a similar proposal. Last May, Pawlenty, a Republican, used his line-item veto and unallotment to cut $396 million in funding for the GAMC program to balance the budget at that point. 

Sponsors of the GAMC legislation are still sifting through the governor's supplemental budget to figure out the impact on health services for low-income residents. The DHS expects about 20,000 childless adults no longer will be eligible for MinnesotaCare because their incomes will exceed the governor's proposed threshold of 75 percent of Federal Poverty Guidelines (about $8,000 a year). Currently, MinnesotaCare enrollees without children are eligible up to 250 percent of FPG. The majority of current GAMC enrollees bring in less than $3,000 annually.

"The governor's budget is like an onion," said Minneapolis DFLer Sen. Linda Berglin, chair of the Health and Services Budget Division. "You just keep on peeling it, and it keeps making you cry more."

Rep. Murphy is carrying the bill in the House and expects momentum to build for passage because of the governor's actions on Monday.

"I always anticipated that this could happen," Murphy said. "This is one of the hallmarks of Gov. Pawlenty. He is unwilling to negotiate and he isn't really interested any more in solving the problems we face in Minnesota. So, I will be looking to my legislative colleagues to solve this problem."
 
Reaching across the aisle
Which means getting a few Republicans on board. They will be needed to form a supermajority in the House if members attempt to override a veto of the GAMC proposal. Even then, members may have to figure out a way around the governor's use of unallotment.

Murphy met Monday with the ranking Republican on the Health Care and Human Services Division.

Republican Rep. Jim Abeler, vice chair of that division, doesn't think the door is closed yet to serving the state's poorest of the poor and their health-care needs. The governor's plan is just one step in the debate, he said, adding that legislators need a reality check about the state's fiscal crisis. The GAMC and General Assistance pots of money, he said, are among the few without "federal strings" that the governor can tap to cover the deficit.

"If you're talking about the budget vs. the GAMC question, they're kind of two different topics but they're inter-related because the whole system is going broke," he said. "I'm an optimist and I think there's something we can do to provide some relief to those GAMC recipients who are at risk. It may not be to the extent that the various groups would like. If we can find ways to keep coverage in a MinnesotaCare benefit set, that would be not too bad."

As far as Murphy and Berglin are concerned, their proposal keeps in mind the budget constraints.

Murphy: "Our proposal provides 16 months of coverage for Minnesota's sick and poor, and we do it for less money than the auto-enrollment (into MinnesotaCare) proposed by the administration. We protect jobs. We protect taxpayers. We protect Minnesota businesses from the cost of caring for people we know are sick and have no coverage."

Berglin: "The bill we're passing not only takes care of 85,000 people who need GAMC, it keeps MinnesotaCare solvent so there'd be no need to dis-enroll people."

An eligibility pecking order
Years ago, legislators put into statute a pecking order of who loses eligibility first in the event the Health Care Access Fund, funded primarily by a 2 percent tax on health-care providers to cover MinnesotaCare, was in danger of running out of money — a fate expected in 2011. Childless adults are first in line to lose eligibility.

"At the time that the law got passed, we got all these what-if" questions, Berglin said. "What if you don't have enough money? What if the fund that you're dedicating isn't producing enough revenue to cover everybody? So we put that in there to answer that question, never thinking it would ever be used. The program has been in place for over 20 years, and it never has been used."

Abeler said he has not received any complaints from Anoka County stakeholders about 1,200 former GAMC enrollees who have been switched to transitional MinnesotaCare. "I haven't heard a peep from the hospitals or anybody, which is interesting," he said.

Those people currently have access to that $203 monthly stipend or some other income to cover their share of the co-pays and premiums, however. That money could go away.

"It's not the budget I would have written," Abeler said about the proposed elimination of General Assistance. "It's not the choice I would have made."

Could affect insurance premiums
The Minnesota Hospital Association expressed disappointment in the governor's supplemental budget and pointed out the implications in a statement: "The price businesses and individuals pay for health insurance is likely to increase as health-care providers are forced to increase their prices for private payers to make up for the state's underpayments."

Liz Doyle, policy director for TakeAction Minnesota, also expressed disappointment in the governor's plan to eliminate General Assistance at the same time they're moved to a program that requires higher co-pays and premiums. "I think his proposal just really pulls the rug out underneath the most vulnerable people in the state," said Doyle, whose organization is among leaders in the Save GAMC alliance.

She also is concerned about 20,000 low-income people losing access to MinnesotaCare in order to accommodate the shift. "As we're pulling out of an economic recession there are a lot of Minnesotans struggling to get back on their feet, and the last thing they need is to also be losing their health care coverage," she said. "These are working people … they simply lack affordable health-care coverage at work."

Despite her disappointment in the governor's budget proposal, Berglin remains confident the GAMC legislation will get to his desk.

"I'm sure he put the budget together before he knew what our GAMC bill would look like or whether he would be inclined to sign it or not," she said. "I'm not going to count on him not signing until I hear it myself," she said. "I know there are a lot of different groups talking to him about the need to sign it."

Casey Selix, who covers health reform and other issues for MinnPost, can be reached at cselix[at]minnpost[dot]com. Follow her on Twitter.