A Step Backwards: The Impact of Washington’s budget cuts on Healthy People and the Environment

We continue our series of posts this week delving into the effect budget cuts have had on Washington state’s key priorities with a look at the impact on Healthy People and the Environment.

It’s essential to remember what we’ve already done as a number of key decisions are made in over the next several weeks. Gov. Gregoire is soon expected to announce across-the-board budget cuts that would come on top of the cut’s we’ve made. Then in November, voters will decide whether to approve ballot measures that would further reduce state resources and move us even further backwards in maintaining what Washingtonians have held dear.

Healthy people and environment

Quality of life in the state depends on healthy people and environment. Good health allows people to participate in the social, economic, and cultural opportunities of their community. A healthy environment ensures food, water, and recreation without fear of pollution or toxins. Efforts to promote a healthy state are part of our shared responsibility and benefit all of us.

Goals for the state budget that will help us achieve a healthy people and environment include:

•    Protecting public and environmental health;

•    Supporting families and protect children;

•    Expanding health insurance coverage and quality of care; and

•    Caring for people with long-term health needs.

The budgets for agencies focused on these goals account for about 30 percent of the current NGF+FR* budget (Figure 1A). In total, the budget for these goals has already been reduced by over $1 billion (a 9.3 percent cut) in the current biennium (Figure 4B). As a result of these cuts, tens of thousands of Washingtonians are losing access to affordable quality health care and the quality of care for many others has been reduced.

Protect public and environmental health

Budget cuts to public and environmental health total $149 million (23 percent).

The largest single cut ($55 million) in this area was made by ending state funding for universal coverage for the HPV vaccine and discontinuing state funding for the universal purchase program for other vaccines (with children enrolled in state health care programs and some other children from families with very low incomes still eligible for vaccine coverage). This cut was made in 2009. In the 2010 session, a public/private partnership was established that will allow the universal vaccine purchase program to continue providing vaccines to children.2 Other Department of Health cuts targeted grants to local health jurisdictions, family planning grants, tobacco prevention, poison control, nutrition assistance, and services for people living with HIV/AIDS.

A $12.4 million cut to Division of Alcohol and Substance Abuse (DASA) within the Department of Social and Health Services has sharply scaled back funding for treatment of substance abuse and detoxification services for lower income Washingtonians. In the Department of Ecology, funding for watershed planning and water rights processing was cut.

Support families and protect children

Budget cuts to programs that support families and protect children total $70 million (9 percent). Cuts include reductions in behavioral rehabilitation services provided to foster children with severe needs, services aimed at preserving families, and broad administrative cuts and freezes on payment rates, contracts, and so on. Over $10 million in cuts to programs including Crisis Residential Centers, HOPE beds, and the Street Youth Program, are offset with funding from the Home Security Account.

Expand health insurance coverage and quality of care

The biggest single health care budget change was a 43 percent cut to Basic Health. Basic Health provides affordable health insurance for lower income Washingtonians, most of whom are working but lack employer-provided coverage. The cuts to Basic Health made last year will eliminate coverage for over 44,000 people and increase premiums for the remaining enrollees by 50 to 100 percent.3 The state has eliminated Basic Health coverage at a time when the need for the program is rising dramatically. Since last April, the number of people on the waiting list for Basic Health coverage has risen from under 20,000 to over 93,000. There are now significantly more people on the waiting list than on the program.

Medical assistance for persons who are temporarily unable to work due to disability has been scaled back in the current budget. (This assistance is provided through the Disability Lifeline program, previously called GA-U. Information on financial assistance provided through this program is included below.) The 2010 legislature significantly altered this program, imposing time limits (24 months within a five-year period), improving transitions to federally-funded programs, and imposing stricter chemical dependency requirements. These changes are expected to result in a significant reduction in the average number of clients being served by the program and reduce the budget by $16 million. Another $16 million will be saved in the budget by transitioning clients to managed care initiatives. The budget also includes a $22 million increase to cover increases in need for the program.

The budget passed last year aimed to decrease the amount of state money spent on pharmaceuticals by $84 million. (This cut would decrease federal funding as well for a total cut of $183 million.) The biggest component of this measure is to emphasize the use of generic drugs. In addition, the budget aimed to reduce the use of certain drugs, provide 90-day supplies of low-risk drugs, and establish drug purchasing initiatives.

Payments made to hospitals, clinics, managed care plans, and providers for caring for clients of Medicaid and other state health plans were also reduced. These cuts, which have real consequences for patients, providers, and other health care consumers, total about a $242 million reduction in state funding. Cuts to hospital rates were offset by the Hospital Safety Net Assessment, bringing the net change in federal spending in this area to a $104 million increase.

A number of reductions in benefits such as maternity support services, durable medical equipment (including enteral nutrition, bath or shower items, stockings, auto blood pressure cuffs, incontinent supplies, non-sterile and sterile gloves, and diabetic supplies), and dental care reduced the state budget by $27 million and decrease federal funding by $33 million.

Other cuts include reducing health services provided to lower income families not eligible for Medicaid because of their citizenship status, cost controls in transportation, laboratory and X-ray services, and suspending outreach for Apple Health for Kids.

Federal recovery funds were essential to prevent even deeper cuts in this goal area. The temporary increase in Medicaid matching funds provided over $1 billion and other federal sources kicked in another $267 million. This total will be somewhat less than expected because Congress passed a smaller Medicaid enhancement extension package.

Care for people with long-term health needs

The biennial budget made deep cuts in adult day health programs (structured daytime programs that provide skilled nursing care and rehabilitative therapy as well as an important source of social activity). As a result of the cuts, clients living in adult family homes or boarding homes were no longer eligible for adult day health. In September 2009, this cut was declared to be a violation of due process rights and the affected residents were again eligible for services. The cut was also declared to violate Medicaid rules. The 2010 legislature reinstated eligibility for residents of adult family homes and boarding homes, but placed an enrollment cap on the program. The budget also made cuts in transportation assistance, including eliminating such assistance for clients living at home. On net, the total budget reduction to adult day health was $11 million in state funding and $6 million in federal funding.

Over 30,000 long-term care and developmental disability clients receive care in their own home. These services, which are essential to allowing people to remain in their own homes, meet needs not met through other resources. The current budget has made $34 million in cuts to this service, compounded by a corresponding loss of $51 million in federal funds.

Deep cuts have been made to the rates paid to nursing homes, boarding homes, supported living facilities, group homes, and so on for caring for people with long-term care needs. Some of the cuts made to nursing home rates in the 2009 session were blocked by a court decision. Including the restoration of those cuts, rate cuts total $31 million in state funding and $42 million in corresponding federal funding. In addition, there were sharp cuts ($34 million state, $9 million federal) to the rates provided to Regional Support Networks to pay for the care of people with serious or long-term mental illness, in particular for those clients not eligible for Medicaid.

Other cuts in this area total $64 million in state funds and $8 million in federal funds. Federal recovery funding (through an enhanced Medicaid match) was expected to provide $1.2 million in funding to care for people with long-term health needs in the current biennium. This total will be somewhat less than expected because Congress passed a smaller extension package.

In response to the continuing recession, the Governor is expected to make further across-the-board cuts that will force more reductions in our support for health people and environment.

Our efforts in this area will again be in jeopardy in November. Measures like I-1107 (which would repeal modest increases in non-essential items like candy, soda, bottled water and beer) or liquor privatization initiatives I-1100 and I-1105, would further reduce state resources for health care and environmental protection.

Another measure, I-1053, would allow a minority of legislators to cause gridlock and prevent our ability to take reasonable steps to preserve the health of our neighbors and our environment

Read the entire policy paper, "A Step Backward: The 2009-11 State Budget."

*This report focuses on the part of the state budget known as the “Near General Fund,” which in the current biennium includes the state General Fun and the Education Legacy Trust Fund. Also included is a newly created fund called the Washington Opportunity Pathways Account, which funds certain efforts in early learning and higher education. The combination of these funds is referred to here as the Near-General Fund plus Federal Recovery.