The 2013 General Assembly Session adjourned sine die at 5:21 pm on Saturday, February 23. Fortunately we adjourned as scheduled, saving the Virginia taxpayers the cost of additional days. One of the most important pieces of legislation that we deal with each Session is the biennial budget. Therefore, I wanted to provide a brief update on the budget proposal that passed both bodies on Saturday.
FY 2013-2014 Biennial Budget
On Saturday the Virginia House of Delegates adopted a series of changes to Virginia’s biennial budget. Among other key investments, the conference report we passed on Saturday includes a series of targeted investments in K-12 education, as well as Virginia’s Rainy Day fund and other savings accounts.
This budget includes a $95 million investment in the Rainy Day fund and $30 million for the Federal Action Contingency Trust Fund. The FACT fund is set up to help Virginia prepare for sequestration and other cuts that could come from the Federal Government.
Additionally, this budget compromise includes a series of important investments in K-12. This includes a fully funded pay raise for teachers and support staff, as well as funding for a strategic compensation model for local leaders to use to help reward outstanding teachers. Additionally, it funds the Opportunity Education Institution, designed to help rescue failing schools, and dedicates money to reading and algebra improvement initiatives.
Unsurprisingly, one of the major items considered in the budget this year was Medicaid expansion.
The budget adopted on Saturday does not expand Medicaid.
Medicaid is a struggling system, which is wrought with waste, fraud, and abuse. In fact, a 2010 JLARC study found nearly $90 million in waste that we unfortunately cannot stop due to strict regulations from the federal government. There is too much money at stake here to expand without reform. The passage of this budget guarantees that Virginia will not consider Medicaid expansion without first enacting a series of reforms.
Medicaid is the fastest growing single expenditure in Virginia’s budget. We are doing a disservice to those who depend on Medicaid if we do not look to improve the system. The costs are spiraling out of control, and without this reform we will end up with a broken program and a gap in our budget that we cannot fill. This budget requires reforms of how we provide Medicaid services to reduce costs and prevent fraud. Additionally, it requires that we implement reforms that encourage cost sharing and coordinated care. Our hope is that this will lower costs and improve patient health.
Finally, this budget language requires that we seek waivers from the federal government to allow Virginia to implement innovative models of care and care delivery. We know that we cannot save money within the inflexible bureaucracy of the federal government. These waivers will give us the flexibility to implement new and innovative care that works for Virginia.
This budget also contains language to establish the Medicaid Innovation and Reform Commission. That commission will be made up of 5 Senators and 5 Delegates. That commission is tasked to determine if the reforms made to Medicaid are strong enough for Medicaid expansion to go forward. To do this, they will have to determine if Medicaid expansion saves Virginia money (estimates now say it could cost $700 million or more) and if the federal government is going to provide us with the flexibility to determine how we provide care.
Appropriations Chairman Lacey Putney announced the House of Delegates’ appointees to the Commission yesterday. They are Delegates Steve Landes (R-Augusta), Jimmie Massie (R-Henrico), Beverly Sherwood (R-Frederick), John O’Bannon (R-Henrico) and Johnny Joannou (D-Portsmouth). Each of these legislators have previously indicated that they too are opposed to expansion without reform.
It is important to note that the passage of this budget language guarantees that a future Governor cannot act unilaterally to expand Medicaid. Though Governor McDonnell has said that he does not support expansion without reform, there is no guarantee that a future administration would feel the same. The passage ensures that the final authority for reform and expansion stays with the General Assembly.
Medicaid expansion without reform could destroy Virginia’s financial system. By passage of this budget we have taken a step to guarantee that Medicaid expansion in Virginia will not happen without first enacting serious reforms and without absolutely ensuring that it will not cost Virginia taxpayers.
Thank you to all of you who visited us in Richmond, and to those of you who have called, written, and emailed us over the last few weeks. We are still in the process of responding to our emails, and we appreciate your patience.
Now that Session is over, we are now once again operating out of the district. You can now reach us by phone at 540-448-3999. You can continue to reach us by email at DelDBell@house.virginia.gov, and by mail at Post Office Box 239, Staunton, Virginia 24402.
As always, thank you for allowing me to serve as your delegate.