State budget: Health services funding cut, some coverage expansion provisions OK'd

The state budget passed by the General Assembly last night has providers from around the state bracing for serious cuts (Source: “Ohio’s two-year budget could devastate some community health services, cost jobs, businesses,” MedCity News, July 14, 2009).

Mental and behavioral health organizations are set to see millions of dollars of funding cut under the new budget. 

The National Alliance on Mental Illness of Ohio estimates that state funding for community addition prevention and treatment services will be cut by 30 percent and community mental health services will drop by 16.5 percent over the next two years.  The Ohio Association of County Behavioral Health Authorities estimates that the cuts will result in 14,000 Ohioans losing mental and behavioral health services.

Nursing home organizations say they are anticipating a loss of $184 million over the next two years and hospital officials say that the budget’s provision calling for $125 million worth of new hospital franchise fees could result in layoffs or reduction in services.

On a somewhat more optimistic note, some of the proposals for expanding health coverage that were original offered by Gov. Ted Strickland in his original budget proposal made it through the cost-cutting process (Source: “Ohio Department of Insurance working to provide health care coverage to underinsured without waiting for national health reform,” Cleveland Plain Dealer, July 14, 2009).

The biennium budget includes the following provisions related to expansion of coverage:

• Capping premiums in the Open Enrollment Program at about $400 a month, a move that is estimated to allow 52,000 Ohioans with pre-existing conditions to obtain coverage
• Allowing uninsured employees of small businesses to use cafeteria plans to purchase coverage with pre-tax dollars
• A new rule allowing dependents up to age 28 to be covered by employer-sponsored insurance plans, at no additional cost to employers
• A requirement that insurance companies report what portion of premiums is being spent on health care, marketing, administrative costs and profits