Unfunded Mandates Will ‘Blow Up’ State Budget
Saying the health care reform bill working its way through Congress would break the bank in Oklahoma state government, Oklahoma Senate President Pro Tem Glenn Coffee and House Speaker Chris Benge called on Oklahoma’s Congressional delegation to vote against the bill.
“We are already facing unprecedented fiscal challenges in Oklahoma with the national economy in its current condition,” said Coffee (R-OKC), “and adding the unfunded mandates on Medicaid that this bill will impose on us will be catastrophic to our budget, and to states across the nation.
“This would be a disaster. I can’t strongly enough urge our Congressional delegation to vote this bill down.”
“In Oklahoma, we have put in place market and consumer driven reforms that are working to move our state’s uninsured onto private insurance, all while improving access to affordable health care for all of our citizens,” said Benge (R-Tulsa). “I wish Washington would give states the maximum amount of flexibility possible to craft a health care plan that best meets individual state needs. A one-size-fits-all health care policy is not the answer for Oklahoma, or our country as a whole.”
In response to an inquiry from Congressman Tom Cole regarding the potential impact the health care bill could have on Oklahoma, Senator Coffee sent a letter to Cole on Tuesday, outlining his concerns, and urging him to work to defeat the bill.
In his letter to Cole, Coffee said:
The state will most likely face a continued reduction in revenues in FY’11. The FY’11 budget assumptions most likely will include spending the last of the Education and Medicaid Stimulus funds as well as Rainy Day funds in order to maintain current levels of service.
The FY’12 outlook is even more dire as the absence of Stimulus and Rainy Day funds will have a significant impact on the budget. The absence of stimulus funds will be most apparent in the Medicaid program, where over $400 million was used in FY’10 and over $500 million will be used just to maintain current services in FY’11. Adding tens of thousands of adults to the Medicaid rolls when the state is struggling to cover children and the elderly is irresponsible at best.
The reality of this bill is that more low-income individuals (now up to 150% of the federal poverty level) will be pushed onto the rolls of Medicaid (Sec. 1701) leaving already over-stretched State Governments, ours included, to pick up the tab.
Benge said in his letter to Congressman Cole:
Oklahoma already is experiencing difficulty funding its current Medicaid program due to revenue shortfalls as a result of the national recession and decreased natural gas prices. Revenue collections to the state in the first quarter of FY-10 trailed last year’s collections by 29.5 percent. State agencies, on average, experienced an initial budget reduction of 7 percent when compared to FY-09. Agencies are also expected to see 5 percent cuts in their monthly allocations for the remainder of the fiscal year. Even deeper cuts may be necessary if future revenue streams continue to decline. In the current economic environment, Oklahoma is struggling to maintain core services for its citizens. And that is before the ramifications of this federal health care policy and its unfunded mandates are even considered.”
“In short, if it becomes law, the health care bill proposed by Democrat leaders in Washington could blow an additional $128 million hole in our already depleted state budget,” Coffee added. “The only solution would be to impose massive tax increases or deep, deep cuts into viable state services.
“Certainly, there are areas that could be cut in state government, but these cuts would go past the muscle and into the bone,” Coffee concluded.
“This legislation would do much more to hurt our state than is likely even known right now,” said Benge. “I am confident that our senators and representatives in Washington will listen to the burden this legislation will place on the states in which they live and will make the right decision in the end. We must do all we can to inform the American people of the ramifications of this legislation while there is still time to stop it from becoming law.”
Coffee noted that the specter of SQ 744, constitutionally mandating $850 million in spending for common education if passed, on top of the health care legislation, would cause irreparable damage for Oklahoma’s fiscal health for generations to come.
“Oklahoma’s budget is sick right now, and imposing these added mandates on the patient is not what any competent doctor would order,” Coffee added. “I trust our Senators and Representatives in Washington to do the right thing and lead the charge against this disastrous bill.”