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Health highlights in the budget: UPDATES

June 27, 2011

APOLOGIES: There are a few details l I missed, which are corrected here. If you want to dig into the details yourself, here’s a link to the amendments to the House Finance budget.


If you weren’t awake at 1:40am Saturday when the RI house passed its version of the state budget, you’re not alone.  I was also asleep in bed, but our heroic political reporter Ian Donnis was on the scene, keeping track of the latest developments.

With his help, I’ve gathered up a few health related budget decisions. Here they are-

Taxing non-prescription drugs

The House recommends getting rid of the sales tax exemption for over the counter drugs (and in this case they’re strangely putting medical marijuana into this category.)  The House expects to generate about 11.5 million dollars a year from the change.  The tax would go into effect October 1st of this year.

RI’s elderly would still receive prescription assistance

Governor Chafee proposed eliminating the Rhode Island Pharmaceutical Assistance Fund– money that helps elderly Rhode Islanders buy prescriptions when they’re in the “donut hole”- the space where they’ve spent too much money on drugs  to get assistance from Medicare, and haven’t spent enough to qualify for additional Medicare assistance. National health care reform is shrinking this “donut hole” and will eventually eliminate it entirely, but advocates for the elderly say for now, they still need assistance. The House budget agrees, and has put aside $349,000 to fully find the program.

UPDATE: an amendment adds an additional $100,00 to the program-

RIPAE: Adds $25,000 in general revenue and $75,000 in restricted receipts for the Rhode Island Pharmaceutical Assistance for the Elderly program, as described in Article 23.

Still counting on money from compassion centers

Despite the fact that Governor Chafee has put the state’s medical marijuana retail store program on hold, the House is still expecting to collect revenue from the non existant businesses. In addition to applying sales tax to medical marijuana, the budget imposes a 4% surcharge on compassion center revenues.  Lawmakers expect to generate $600,000 between July 1st, 2011 and June 30th,2012. Good luck with that guys.

Keeping the Health Services Council

The Health Services Council is responsible for approving or rejecting proposals for expensive projects in RI’s health care world. For example, when Butler Hospital wanted to add 26 new beds to its campus, the council had to evaluate whether Rhode Island really needed all of the extra space for people with mental illness.  The council also reviews other request- new hospital wings, expensive equipment, new services…

The idea is all of these new expenses increase the cost of health care in the state, so we need to be really sure that they’re necessary.  Few people disagree with this statement, but critics question the power of the council. “Have they ever rejected anything?” one insider asked me. Dr. Michael Fine, the director of the Department of Health, was in favor of getting rid of the council until RI could actually design a coordinated vision for health care services in this state.   In any case, the House still thinks the council is useful, so it’s renewing $380,515 in state funds to keep it going.

More food inspectors

Maybe the case of the contaminated Zeppoles convinced the House that RI needs to keep a closer eye on its food. Lawmakers are putting aside $200,000 dollars to hire three new full time food inspector positions.

Goodbye personal choice

The House expects to save $900,00 by eliminating the “Personal Choice Waiver” that gives elderly folks and people with disabilities a monthly allowance to hire their own health care providers,  allowing patients to stay at home.

CORRECTION: Thanks to reader sirgrahame for pointing this out. An amendment on the House Floor partially saved this program. It was originally eliminated  in the House Finance Committee’s version of the budget. Here’s the amendment-

Personal Choice Waiver: Rather than eliminate the program, the House directs DHS to achieve savings by decreasing costs to reflect the level of spending for beneficiaries in the regular home and community based services program. The average monthly cost of care for enrollees in the Personal Choice program is $3,257 per month, while in the regular program it is approximately $1,500 per month. The House restores $211,503 in general revenue for total general revenue savings of $211,503 ($443,700 from all funds).

No more RIte Share co-pays

Under the House budget, Rhode Island wouldn’t be picking up the bill anymore when low income families on RIte Share have co-pays at the doctor’s office, the pharmacy, or the hospital. The House estimates the cuts would save $143,000 in state funds.

And, folks on RIte Share pay more per month

The House wants to increase the amount low income families pay per month for their RIte Share health coverage. Families that make between 150% and 250% of the poverty level would pay 5% of their income each month for their health care. That means a family of 4 at 150% of poverty level (earning $33,525 a year) would pay about $140 a month. Currently, monthly payments for RIte Share range from $61 to $92 a month.  The House expects to save $700,000 in state funds from this change.

I have calls out to make sure I understand the budget changes related to hospital and nursing home payments. Those funding mechanisms are pretty complicated and I don’t want to misrepresent them. I’ll post updates when I have them.

And of course, this budget is subject to approval from the RI Senate, but Ian Donnis is hearing  it’s unlikely there will be any major changes. Then it goes to the governor’s office for his signature.

In the meantime, is there anything major I missed?

2 Comments leave one →
  1. June 27, 2011 11:01 pm

    “The House expects to save $900,00 by eliminating the “Personal Choice Waiver” that gives elderly folks and people with disabilities a monthly allowance to hire their own health care providers, allowing patients to stay at home.”

    I believe this was not eliminated and was saved via amendment. But I have been wrong before. 🙂

    • June 28, 2011 1:55 pm

      Thanks for the catch. Just spoke with the House’s press office and they’re checking on that for me. I’ll make a correction when I hear back. Yesterday they told me there were no amendments affecting the health care issues in the budget. Maybe we missed one!

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