Gov. Paul LePage is proposing about $50 million worth of MaineCare savings over the next two years.
But he wishes he could have cut more.
LePage and administration officials said Maine is being punished by the federal Affordable Care Act, which says states that have already expanded access to Medicaid health coverage cannot scale it back now.
“Our hands were greatly tied,” said Mary Mayhew, commissioner of the Department of Health and Human Services.
Democrats say the averted MaineCare cuts are another example of how the controversial federal law is helping Mainers.
“I don’t think we’re being punished at all,” said Emily Cain, the House minority leader. “The Affordable Care Act is an effort to bring the nation to where Maine has been.”
MaineCare is Maine’s version of Medicaid, a national program that provides subsidized health insurance to poor children, the disabled and elderly and other qualified adults. The state pays about one-third of the costs and the federal government pays about two-thirds.
Overall, LePage’s budget proposal would increase state spending on Maine-Care by more than $200 million over the next two years. The net increase would cover rising costs and a reduction in federal reimbursements, among other things.
The proposed two-year general fund budget includes a total of $1.3 billion for MaineCare, which amounts to about 21 percent of LePage’s budget.
The proposal would eliminate Maine-Care eligibility for non-citizen immigrants, require more cost-sharing by recipients and cut off enrollment of parents who earn more than 133 percent of the poverty level. The current limit is 200 percent.
The proposal also would cut about $50 million from the MaineCare budget.
LePage made clear in his budget address Thursday that he wished he could have gone further but was not allowed to roll back Maine’s MaineCare eligibility standards.
Maine currently goes beyond many states’ programs by providing Maine-Care access to childless adults and parents of enrolled children.
The Affordable Care Act will require all states to offer similar access starting in 2014. In the meantime, the law says, states that already meet the future eligibility standards have to keep them in place or face a penalty.
“The federal government says, if you’re going to (reduce eligibility), you will jeopardize all of your federal funding,” Mayhew said.
Mayhew said the fact that the administration’s hands were tied on MaineCare meant it had to go elsewhere for savings. The budget includes laying off 10 people and eliminating some programs within the Fund for a Healthy Maine, a popular collection of public health programs created with tobacco settlement proceeds.
Mayhew said the fund would lose $18 million to help cover MaineCare expenses.
While Maine is one of the states fighting to overturn the Affordable Care Act in court, the administration has to comply with the law in the meantime, said Tarren Bragdon, director of the Maine Heritage Policy Center and a former member of LePage’s budget team.
“Everyone is frozen in time by Obamacare,” he said.
Deeper MaineCare cuts would have created more uninsured Mainers and cost the state in lost federal funding, said Christopher St. John, executive director of the Maine Economic Policy Center. “That’s two-thirds federal dollars.”
Even the proposal to freeze future MaineCare eligibility for some parents is a step backward, he said.
“This is precisely the working poor. They are not on welfare,” he said. “This is exactly the kind of person we should be” helping.
Staff Writer John Richardson can be contacted at 791-6324 or at: jrichardson@pressherald.com
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