Minn. Senate passes deep cuts for health, welfare programs

Jacque Morrow
Jacque Morrow, 43, a homeless woman in Bemidji, was just shifted to the state's Medicaid program, known was Medical Assistance. But the Senate has approved a bill that would reverse the Medicaid expansion approved earlier this year by Gov. Mark Dayton. She is seen here on March 9, 2011.
MPR Photo/Tom Robertson

The Minnesota Senate passed a sweeping health and human services bill on Wednesday, including historic changes to health care for the state's poor and disabled. The bill was approved on a 37-26 party line vote.

Republicans proposed spending $10.7 billion on health and human services programs over the next two years, more than $2 billion above current levels. But it's still more than $1.5 billion short of expected growth of current programs.

To help close Minnesota's $5 billion budget gap, the bill cuts some nursing home funds, family planning programs, and health screening and programs for the disabled.

Debate about the bill, though, centered mostly on the proposed privatization of health care for the poor.

"Medicaid, the system that we have, is broken. Medicaid doesn't work," said Sen David Hann, R- Eden Prairie, who chairs the Senate's Health and Human Services committee, and is chief author of the plan.

"What this is doing is taking the people who qualify for public health care in Minnesota, and allowing them to receive a voucher or a stipend or a grant from the state of Minnesota that enables them -- and can only be used for the purpose of -- going to the private insurance market and buying a health care plan in the private market," he said.

Hann told senators the change would save about $600 million, accounting for nearly a third of the bill's budget savings.

"Medicaid, the system that we have, is broken."

DFLers spent hours trying to thwart the change. They said the deductibles built into the insurance plans for the poor, up to $12,000, were impractically high.

They said the proposal would require permission from the federal government, which was unlikely to be granted even by a Republican administration.

Sen. Linda Berglin, DFL-Minneapolis, said the plan would drive the poor out of insured care altogether.

If she were poor and thought she was having heart problems under the Republican plan, "I'm not going to the doctor. I'm going to go to the emergency room. And let the emergency room and the doctor eat those costs. Because financially, I just can't afford it. And that will drive up our health care costs," Berglin said.

The Dayton administration said it expected the plan would immediately drop 100,000 people out of Medical Assistance, and into the much smaller General Assistance Medical Care program.

The Department of Human Services estimates that the deductibles and extra application process would drive an additional 86,000 people, including families with children, out of health insurance altogether.

But despite those criticisms, Hann defended the plan.

"The only way you're going to get efficiencies and drive innovation in the health care system, is to get people who are spending their own money, and asking questions of providers, what am I getting for this? And how do I know it's the right thing?" he said.

Senators debated other provisions in the bill, including a repeal of a law dating back to 1976 that prohibits nursing homes from charging more to patients who pay their own way than for patients on public programs.

Nursing homes want the market freed, as it is in all other states besides North Dakota. Organizations like the AARP say Minnesota should keep the rate equalization.

Senators also debated again whether a ban on human cloning should include embryonic stem cell research. And they debated a provision pulling Minnesota out of the Affordable Care Act -- the federal health care overhaul passed last year.

All of those provisions survived.

The final bill did, however, restore a 50 percent cut to state funding for Meals on Wheels programs for seniors.

The House has yet to act on its version of the bill.

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