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Va. budget comes with Medicaid stipulation

Yes Virginia, a new state budget has been approved.

The General Assembly passed the budget late Thursday night but not before adopting an amendment that makes sure the governor can’t expand Medicaid without receiving approval from the full legislature.

It was almost midnight Thursday when the General Assembly adopted the spending plan, a move made possible by Monday’s resignation of Democratic Sen. Phil Puckett.

Puckett’s resignation gave the Republicans a one-seat advantage in the senate, and that one seat was enough to get the deal done.

Now it goes to Gov. Terry McAuliffe for his signature, something he has vowed he will not do if the budget doesn’t provide Medicaid expansion to some 400,000 low-income Virginians.

The issue of Medicaid expansion, which Democrats had coupled with the budget, had been the sticking point that kept the General Assembly from reaching a budget consensus before they adjourned in March.

The change in the stalemate occurred after the Senate majority changed hands earlier this week when Senate Republicans regained control.

It was then that a budget, which did not include Medicaid Expansion, was passed ending the political gridlock. 

Republican Del. James Edmunds II joined 68 other members of the House of Delegates in voting for the budget that addresses the state’s $1.5 billion revenue shortfall and does not include Obamacare’s Medicaid expansion.  

“We were joined by 21 senators to insure that the state’s core functions continue,” Edmunds said Friday.

Although this budget closes the $1.5 billion revenue shortfall, legislators had to make difficult decisions to cut spending compared to the original budget and ended up using some of the state’s rainy day fund, according to Edmunds. 

“We simply cannot spend money we don’t have, and unfortunately, we had to eliminate teacher pay raises and new funding for higher education. The bright side to this is that we were able to keep over $300 million in new classroom funding for K-12 education, about $50 million in new funding for mental health reforms and investments in our state employee retirement system,” the delegate said.

At no point did the budget include language that would have allowed the governor to expand Medicaid without the approval of the Medicaid Innovation and Reform Commission. 

However, because reports have suggested that McAuliffe may try to do so, the General Assembly added a clarifying section that unequivocally prohibits the expansion of Medicaid without the approval of the legislature.   

 “Assuming the governor signs the new two-year budget, local governments can now breathe a sigh of relief that a new budget will most certainly be in place on July 1 as scheduled,” said 20th District Republican Senator Bill Stanley. “As a result, the state’s vast education systems, city and county law enforcement departments, the multitude of EMS resources and all other local government agencies can continue operations without the threat of interruption.” 

“The budget was no longer being held hostage by the Senate Democrats,” Stanley said. “Republican Senators took our responsibility to Virginia seriously; we were prepared to go back to work immediately and were resolved to complete the job.”

And Medicaid expansion will be addressed at a later date.

“Once the budget is signed, we can return to Richmond to debate Medicaid expansion and what it will mean for Virginia,” said Del. Edmunds.  

Medicaid now costs the state about $4.1 billion per year - about 20 percent of general fund spending, according to the 60th District delegate. 

“It is growing at an average rate of 8 percent per year. This year alone it grew by over $500 million.  I have expressed deep concerns about Obamacare’s Medicaid expansion,” he added. 

“Our current program is unsustainable and needs reform; Virginia cannot afford the long-term costs; we cannot trust the federal government to pay for Medicaid expansion forever; and Medicaid expansion is essentially a new welfare entitlement program for able-bodied, working adults.  I will, however, engage in a full and fair debate on the issue,” Edmunds continued.

He expressed relief local governments can now finalize their budgets, and legislators will have an opportunity to debate the very complicated and complex issue of Medicaid expansion separately.

It was within 24 hours of regaining the majority that Senate Republicans (and Senator Colgan [D-29]) called the Senate back into session and back to work.  On the same day the Senate was in special session for the first time in over two months, the state budget was approved.  

However, after its adoption, both legislative bodies had opposing views on how to address the Medicaid Expansion issue. 

Senate Democrats, along with the backing of the governor, were in favor of Medicaid Expansion and by tying it to the new budget, they believed they could force this new legislation on to the citizens of Virginia, Stanley said. 

The House of Delegates stood firm on its insistence that Medicaid Expansion must first be de-coupled from the new budget and addressed as a separate issue.

“I strongly had pushed to de-couple expansion from the budget and to enter into debate in both the House and Senate on Medicaid alternatives, and push for comprehensive reform of the health care industry in order to make quality and affordable health care available to all citizens of the Commonwealth of Virginia,” Stanley said Friday. 

The 20th District Senator sponsored an amendment that was drafted and co-patroned by all 20 Senate Republicans stating that Medicaid expansion cannot be implemented unless the legislature appropriates the money to do so.  The amendment passed 20-19. 

“We need to seriously look at health care and its delivery systems. The budget should not be held hostage for political games. We have a constitutional obligation to the people of Virginia to have a balanced budget and on time. I look forward to an open debate on the issues where we can find Virginia solutions to these important issues,” he added.  

While legislators had to reduce or eliminate most of the new spending in the budget, they were able to keep funding for localities at current levels. 

“Noticeable changes include the unfortunate elimination of the 2 percent compensation increase for teachers and various reductions in hospital subsidies as well as other cuts. However, it does preserve funding for our local schools and public safety,” Stanley said.

Due to a continuing unstable national economy, the state faces revenue shortfalls that may exceed $1.6 billion over the next three years.

However, Republicans were able to deliver a budget that is balanced, fully addresses the revised revenue estimates, does not include funding for Medicaid expansion, does not allow the governor to expand Medicaid without General Assembly approval and was approved on time and without having to raise taxes on the citizens of Virginia,” the 20th District Senator said.

By law, Virginia’s General Assembly, unlike the federal government, must develop and operate the commonwealth under a balanced budget.   

“The difficult decisions are being made to ensure that our spending does not exceed the revenues and that the taxpayers’ money is being spent prudently and efficiently.  Both chambers have approved a final budget that meets these goals,”  Stanley concluded.