Kick off to state budget discussions

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Every two years, the state government must pass a balanced budget and this discussion gets underway in earnest with the release of the Governor’s budget proposal. Governor Dayton released his plan on January 22 and we’ve reviewed it with a specific focus on elements that impact Children’s Hospitals and Clinics of Minnesota and children’s health.

Initial take
Governor Dayton’s budget proposal includes a number of positive provisions for Children’s, pediatric health care and children’s health more broadly.

Longer-term view
This budget is a starting point and is always revised through the legislative process. Given that the budget is funded in part by new taxes and tax reform, there will be extensive discussion about and likely modifications to the tax portion of the budget, which in turn will impact the amount of funding available for programs.

The breakdown
Critical Funding Issues

Children’s top two financial priorities are Medicaid rates and funding for graduate medical education. After several budget cycles in which reimbursement and/or funding was stagnant or cut, the Governor’s budget includes the potential for increases in Medicaid reimbursement rates for a number of inpatient and outpatient services Children’s provides. In addition, the budget restores funding for graduate medical education to pre-2011 levels, when the program was cut. We are pleased that these funding provisions acknowledge the challenges with under-reimbursement in the Medicaid program and the value of supporting training for our future health care workforce.

Public Health Initiatives
The budget proposal also includes two important provisions that address broader public health issues, including tobacco use and physical activity/nutrition initiatives geared, in part, toward addressing the obesity epidemic. The Governor’s proposal would provide significant funding for the State Health Improvement Program (SHIP), which is focused on population health preventive measures designed to address some of the most costly, chronic conditions in our state.

As a member of the Raise it for Health Coalition, Children’s was also pleased to see that the budget included an increase in the state’s tobacco tax. Governor Dayton had previously been opposed to this tax but chose to include it now because he was convinced of its proven health benefits. Children’s is a supporter of the proposal because price increases are proven to be a significant deterrent in preventing kids from smoking.

Kids’ Health Elements
Several other elements in the budget proposal reflect a clear focus on the health needs of all children. These include a number of provisions intended to address unmet behavioral and mental health needs, better coverage for Autism Spectrum Disorder treatment, care coordination for behavioral health, reforms to the Personal Care Assistance program, changes to child care licensing to prevent death in child care settings, and additional screenings in the Newborn Screening program.

What’s next?
It’s still early in the legislative session and there will be a lot of discussion and modifications over the coming months. However, the advocacy team is encouraged by the starting point for this year’s budget discussion. Stay tuned to the Voice for Kids blog for updates on these proposals throughout session.