SINCE THE FEBRUARY 26 release of Governor Mitt Romney’s $22.9 billion budget plan for the fiscal year that begins July 1, much has been made of its most dramatic and controversial elements — the governor’s bids to reorganize public higher education, to reconfigure local aid to cities and towns, and to eliminate the patronage-laden Massachusetts Turnpike Authority. And reams of coverage have been devoted to the governor’s power struggle with UMass president William Bulger, who’d lose his $309,000-per-year job under Romney’s reforms. In many ways, though, the real action in the administration’s sprawling budget proposal for fiscal year (FY) 2004 is taking place among state-funded health and human services.
To hear Romney tell it, his willingness to be “bold” — and thus take aim at the “patronage, waste, and inefficiencies” on Beacon Hill — has benefited health and human services for the first time since the state’s fiscal crisis began in 2001. On February 26, at a press conference on the FY ’04 budget plan, Romney made a point of stressing that his proposal boosts spending on health and human services by nearly five percent, or $417 million. All told, it allocates $10.9 billion for health and human services — which he touted as an example of his “commitment to delivering the core missions of government.” In a follow-up press event on February 27, Romney fielded questions about his plan following its endorsement by a parade of nearly two dozen business and community leaders. (Four representatives of organizations that serve the homeless, including Lyndia Downie of the Pine Street Inn and Mary Ellen Holmes of the Housing and Shelter Alliance, also participated.) At the time, the governor played up his efforts to preserve funding not only for the homeless, but also for veterans and families living on welfare. He then declared, “We will continue to be a generous state when it comes to caring for the poor, the disabled, and the elderly. We will be far less generous when it comes to patronage, waste, and inefficiencies.”
To be sure, the Romney plan features some clear victories for social services. There’s increased funding — by roughly $10 million — for emergency shelter for homeless individuals and families. There’s an additional $20 million to satisfy a legal agreement mandating that the state provide housing and support services for mentally retarded adults. There’s even a modest rise of $9.5 million for community-based programs and services for mentally ill residents. Advocates are also praising the Romney administration for deciding to shutter two aging and costly institutions as part of its budget: the Worcester State Hospital for the mentally ill, and the Fernald Development Center for the mentally retarded. Charlie Carr, a veteran disabilities advocate, admits he rolled “back on my heels” after reading such details in the proposal. “This administration did a fairly good job of spreading the pain [of cuts] to nontraditional groups like cities and towns,” Carr explains. “I’d want to say ‘bravo’ to Romney on that front.”
But then, such praise must be put into context. Any gratitude among advocates comes in the wake of rumors that the administration intended to gut health and human services. Today, naturally, many are relieved to know that the cuts aren’t as bad as they had anticipated. But their praise has a caveat: because Romney’s plan upends the traditional budget structure, consolidating hundreds of line items into 72 “master accounts,” advocates can’t simply compare current allocations with Romney’s proposals. The reorganization has left them scrambling to figure out what Romney’s budget would really do to the programs and services they deliver. Indeed, it could take weeks before they determine just how damaging the proposal truly is. And since Medicaid spending will grow (thanks to skyrocketing inflation in health-care costs) from $5.9 billion to $6.5 billion in the upcoming fiscal year — increasing at almost double the rate of other human services — many advocates are bracing themselves for almost-inevitable spending cuts. Some State House observers have already gathered as much. Michael Widmer, of the Massachusetts Taxpayers Foundation (MTF), a nonpartisan group in Boston, estimates that Romney’s “savings,” in the end, will come at the expense of real programs that fill real needs, especially in the area of health care. “When all the dust settles,” Widmer says, “you’ll look at account after account and see a significant impact in services. Cuts across human services just aren’t visible yet.”
EVEN BEFORE advocates can sort through Romney’s plan and decipher where, exactly, human-services spending has been cut, they’ve noted that, for all the talk of his “commitment” to core services, the governor still manages to balance his FY ’04 budget on the backs of the state’s neediest citizens. For one thing, the governor’s proposal, known as “House 1,” continues what advocates call the “reprehensible” assault on small state agencies providing social services. It hammers away at the Disabled Persons Protection Commission, which investigates abuse in group homes, by chopping $158,797 from its account — or 10 percent. It slashes away $800,000 from vocational and home-care programs for residents grappling with brain injuries and other chronic disabilities. And it wipes out all $507,000 in funding for the Mental Health Legal Advisors Committee (MHLAC), an eight-person office offering legal aid to some 1000 poor residents who suffer from mental illness and retardation. As MHLAC senior attorney Susan Fendell points out, “This is a terribly vulnerable population with great need for someone to go to bat for them and enforce their legal rights to mental-health care.”
The House 1 budget goes after health-related initiatives with similar abandon. Romney eliminates the highly popular Prescription Advantage, the $98 million prescription-drug program that serves 80,000 elderly and disabled people. (The governor claims he’ll reinstate the program if he can secure a far-from-guaranteed waiver from the federal government to subsidize the funding.) The administration also whacks $7 million from elder-care services, much of it home health aid to seniors. On the public-health front, meanwhile, funding for disease prevention and health promotion continues its descent into the abyss with a cut of nine percent, or $25 million. The state’s smoking-cessation programs, once hailed as a national model, are effectively gutted by a cut of $14.6 million. Home-visiting programs for teen mothers absorb an additional $6 million in cuts, after losing $18 million over the past two years. And early-treatment services such as suicide prevention (now funded at $115,280), osteoporosis screening ($45,000), and prostate-cancer screening ($537,270) would vanish altogether if Romney were to get his way next fiscal year.
In his attempt to balance the budget, the governor also resorts to a host of new fees that hit aid recipients particularly hard. His proposal raises as much as $639 million in fees, levies, and taxes imposed on services — of which a whopping $9.6 million come from new health-and-human-services charges. There are fees for such previously free services as early-intervention parenting programs ($10), tuberculosis testing ($50), and additional TB tests for those unfortunate souls who’ve contracted the disease ($400). Mentally retarded residents will have to pay $100 for an intake assessment at the Department of Mental Retardation to determine their eligibility for state services. There are also charges for blind residents to receive a state-issued ID card ($15), and for families who need Department of Social Services placements (based on an as-yet-undeveloped sliding scale).
And then, there are what amounts to fees for Medicaid (known as MassHealth), the joint state-federal health-care program for the poor and disabled. Under House 1, Romney officials would require the state’s nearly one million Medicaid recipients to pay a premium of up to $19 per month for their health-care benefits, regardless of their ability to do so. In addition, recipients would have to fork over a co-payment of up to $3 per visit for any services that exceed $50. Likewise, the 26,114 low-income families who participate in the Children’s Medical Security Plan, set up to provide health coverage for all uninsured Massachusetts children not eligible for Medicaid, will have to pay as much as $32 per month in premiums, as well as co-payments for routine check-ups. (In a rather slippery move, Romney reduces funding for the $14 million children’s program by about a third in his budget — and then makes up $6.5 million of his own reduction by factoring in these fees.) All told, the administration estimates that new co-payments and premiums will raise $19 million for Medicaid in FY ’04.
Romney has tried to sell the new charges with pithy, sound-bite-friendly assertions about people not getting “something for nothing” at the taxpayers’ expense. As the governor described it in his FY ’04 budget address, “Without a new vision of shared responsibility, where every family contributes something to its own well-being, surging costs will overwhelm us all.” Sounds reasonable, doesn’t it? But what he fails to mention is just who these Medicaid recipients are. They include frail grandparents who’re languishing in nursing homes, chronically disabled residents who live on fixed incomes, and poor mothers and children trying to get by on welfare benefits that average just $496.85 per month. To advocates, the governor’s reliance on such revenue gimmicks will only force thousands of people off Medicaid rolls — and thus lead to further service reductions. Says Geoff Wilkinson, the director of the Massachusetts Public Health Association, in Jamaica Plain, “These fees are irresponsible and ill-conceived. It’s a form of deceit by an administration that refuses to consider new taxes.”
The Medicaid fees represent one of five initiatives that the Romney administration bills as health-care “reforms.” Administrators figure they can generate $175 million in “savings” by not only charging Medicaid recipients, but also restricting their prescription-drug use, reducing payments to hospitals, tightening up eligibility requirements, and making it tougher for seniors to qualify for long-term benefits to pay for nursing-home care. Budget analysts and human-services advocates, however, take issue with the “reform” description. After all, the word implies change for the better. It implies something new and revolutionary that corrects old failings. For the most part, though, the administration falls back on old solutions that, in effect, dance around the problem of how to fund Medicaid — which, at $6.5 billion, is the largest and fastest-growing account in the state’s $22.9 billion budget. Such reforms, says the MTF’s Widmer, “are band-aid approaches. They’re a combination of cost shifting and benefit reductions. They don’t deal with the fundamental problem” of soaring inflation in health care.
To reduce spiraling Medicaid costs, analysts argue, the administration should undertake a more dramatic overhaul of how the public system delivers health care — by, say, reducing its reliance on costly emergency-room care. On the contrary, Romney’s reforms could have the opposite effect. One New Hampshire survey found that a majority of mentally ill people stopped taking psychiatric medications as soon as they had to pitch in for prescription drugs. Other studies have also found that poor people who’re forced to spend money up-front on, for example, co-payments, will delay routine treatments. As a result, they wind up in emergency rooms with more severe illnesses. Mark Reynolds, a former acting commissioner at the Division of Medical Assistance (DMA) and a health-care consultant, maintains that taking steps to lower eligibility and force people off the rolls “is the last thing we should do” to rein in Medicaid spending. This is true despite the argument among conservatives — most recently articulated by Pioneer Institute president Stephen Adams, in a March 3 op-ed in the Boston Herald — that the state’s Medicaid problem flows from efforts to expand eligibility in the late 1990s, not from soaring health-care costs. In his op-ed, Adams cites an MTF report that determined nearly 60 percent of Medicaid expenses from 1997 to 2000 were driven by the program’s expansion. But that line of thinking, Reynolds notes, fails to take into account the fact that even poor people need health care, and they’ll simply show up in emergency rooms to get it. “[Restricting] eligibility isn’t the solution,” he says. “People still need care. If the state doesn’t provide it, the system bears the costs” elsewhere.
As for a general overhaul of human services, the House 1 budget contains the much-anticipated restructuring of the Executive Office of Health and Human Services (EOHHS). The reorganization plan consolidates the 15 state agencies that make up EOHHS into four new divisions: children, youth, and families; disability and community services; health; and elder affairs. It merges “back-office” operations like human resources, accounting, and legal support under the auspices of EOHHS secretary Ronald Preston. And it calls for shuttering 30 of the EOHHS’s 150 local offices, as well as the Fernald Center and Worcester State Hospital. Perhaps the biggest news is the plan’s dismantling of the DMA, which administers Medicaid. In many ways, the DMA has served as the glue that holds EOHHS together, since 94 percent of people who receive EOHHS benefits also receive Medicaid. But now, its functions will be divided among three departments — a set-up that advocates fear will widen the cracks through which folks can fall. Because the plan would break up Medicaid’s “continuum of care,” aid recipients will still have to juggle bureaucracies. For instance, seniors who get elder services and long-term Medicaid benefits will have to deal with two departments. So will children who suffer from behavioral and mental-health problems. As Reynolds, the former DMA commissioner, says, “Officials have tried to come up with a proposal that brings greater coordination. But dangers occur when you split up people who’re currently working together.”
All in all, the administration pegs savings from the restructuring at $60 million, with another $30 million in one-time revenues generated from the sale of EOHHS-owned land and facilities. But while the House 1 budget provides the most detailed picture yet of Romney’s intentions for reorganizing EOHHS, it leaves many questions unanswered. Advocates wonder how, exactly, the savings will materialize. Which of the 30 local offices will be shut down? What’s the timeline? Will “efficiencies” result in more money funneled back into programs for the state’s most vulnerable? Will EOHHS agencies live up to their missions to serve specific populations?
Ultimately, the thinly outlined plan — which the Romney administration is expected to flesh out by May 1, when it files a legislative package detailing how it wants to reform state government — gives advocates no way to verify whether the math is valid. And it leaves them with no way to allay fears that the reorganization will spell devastation for social services. Steve Collins, of the Massachusetts Human Services Coalition (MHSC), sums up the sentiment best: “There’s nothing to suggest that the administration’s primary motivation is to make a better system for recipients. We can’t help but believe it’s to squeeze out money to support Romney’s no-new-taxes pledge.”
THIS WEEK, Romney’s budget plan makes its way to the House, where Ways and Means Committee members have begun poring over the fine print. It’s doubtful that the Massachusetts legislature will rubber-stamp the governor’s plan — indeed, members have already reacted to House 1 with mixed messages. While they’ve commended Romney for delivering a budget that closes the projected $3 billion deficit, legislators have balked at his contention that it saves $2 billion from streamlining and restructuring state government. On Monday, House Ways and Means chair John Rogers (D-Norwood) sent his House colleagues a letter warning that House 1 is based on questionable and unrealistic information. According to the March 3 letter, Rogers’s preliminary budget analysis indicates that the state can save no more than $100 million through reforms in the next fiscal year — a figure that the MTF’s Widmer echoes. Critics have gleefully pointed out that the tax-phobic Romney has gone wild with new fees to generate the revenues needed to solve the state’s fiscal crisis. And they charge that he’s slashed more in direct services than he’s let on to date. In a breakdown of Romney’s budget, Rogers calculates that more than $900 million would come from program and service cuts. “The savings we can expect through efficiencies and reforms will solve only a fraction of the enormous problem,” the legislator wrote in his March 3 letter. “The true difficulty lies in the necessary task of cutting as much as $2 million in programs, services, and aid.”
At the same time, the legislature faces enormous pressure to pass some version of the governor’s far-reaching House 1 proposal. After all, tossing out House 1 opens up legislators to accusations of being obstructionists who are perpetuating the mess on Beacon Hill. Besides, the massive $3 billion budget shortfall necessitates some sort of action. And Romney’s made it hard to identify anything in his budget regarding health and human services that wouldn’t at least survive. Last week, Senator Susan Tucker (D-Andover), who heads the joint legislative committee on human services and elder affairs, tipped her hat toward Romney’s EOHHS reorganization when she wrote an op-ed in the Boston Globe praising the administration for its “important first step.” Compared to Romney’s explosive bids to refashion higher education and recalculate local aid, his proposals on health and human services appear modest, to say the least. In the words of Widmer, “The human-services reorganization is mild. But who knows if legislators will go along with it? We can only wait and see.”
Kristen Lombardi can be reached at [email protected]