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BUDGET FOR FISCAL YEAR 2017

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The budget the Legislature just passed this session is for fiscal year 2017, which begins on July 1, 2016 and pays for services and programs through June 30, 2017.  The following items were included in the budgets passed by the Legislature this year, but the Governor has not yet signed them.  The Governor can “line-item veto” budgets, which means he can veto some appropriations, while signing others into law.  The Governor has until May 29 to decide to sign or veto bills. You can read more about each budget in our Bill Tracker here.

  • $15.1 million (1%) increase for Medicaid - total funding is $1.32 billion.  This includes a cut of $16.8 million to DHS for undefined “process improvement savings.” Legislators were unable to find out what these "process improvements" were, but DHS is prohibited from implementing cost-saving changes that would align Medicaid reimbursement for physicians with Medicare rates, and changes for people eligible for both Medicare and Medicaid (dual eligibles).  DHS is required to report to legislators any cost containment strategies and “process improvements” made.

  • $67 million was added to the current year's Medicaid budget (fiscal year 2016), and DHS was allowed to move unspent money around to make up for the remaining $15 million shortfall.
  • $100,000 increase for an additional long-term care ombudsman to provide assistance and advocacy to persons receiving Medicaid waiver services.

  • $150,000 increase for the Department of Public Health's brain injury program for brain injury resource facilitator services and brain injury service provider recruitment and training (total $1.04 million).

  • $86,000 increase to the Children at Home program for expansion to new service areas (the Family Support Subsidy is reduced by $4,650 as the program continues to phase out and transition to the Children at Home program).

  • $1 million to increase HCBS provider rates by 1%, and $1 million to increase home health agency rates by 1%.

  • $200,000 for a new contract with the College of Direct Support to provide internet-based training for mental health and disability services providers.

  • $2 million to reduce HCBS waiver waiting lists.  DHS is required to report on the impact of changes in the HCBS waiver supported employment and prevocational services (report due 12/15/16).

  • $500,000 for Eastern Iowa Mental Health Region (Scott County) & $2.5 million for Polk County Mental Health Region. DHS is required to report on the progress of MH/DS redesign, including identifying any challenges facing redesign; governance, management, and administration; best practices, including evidence-based practices; availability of, access to, and provision of initial core services and additional core services to and for required core service populations and additional core service populations; and the financial stability and fiscal viability of the redesign.

  • $300,000 for the development of children's mental health crisis services, and establishment of "learning labs" to review emerging collaborative efforts that improve the well-being of children with complex needs and their families.  The bill also creates the Children's Health & Well-Being Advisory Council within the Department of Human Services to continue the work of the same-named work group.

  • $100,000 new appropriation to Department of Public Health to to develop recommendations for a broader, more systematic and strategic workforce initiative, which may include a comprehensive study of workforce program needs and the establishment of an advisory workgroup (due 12/15/16).

As noted in other articles, the budget:

  • Continues $2 million in funding for the Autism Support Program, retains any funds unspent at close of fiscal year, and makes changes to program eligibility (click here for more details).
  • Adds strong consumer protections and government oversight of the Medicaid managed care system (click here for details).

Most other areas of the budget remained the same as the current year - vocational rehabilitation, Entrepreneurs with Disabilities program, Newsline for the Blind, independent living center grants, and farmers with disabilities program.  Instead of cutting whole programs, the Administration & Regulation Budget (Senate File 2314) opted to cut all agencies by .5% - including the Office on the Status of Persons with Disabilities and Office of Deaf Services in the Department of Human Rights. 

It is important to note that, contrary to what you may have read in news reports recently, the Legislature did not include an increase for supported employment in the budget passed this year.  As you might recall, last year the Legislature appropriated (and the Governor signed) a $750,000 increase for supported employment providers, but forgot to include the language that stated how that money was to be used.  While it was included in budget document descriptions, it was not specifically outlined in law, and therefore was not implemented. 

On a final note - the Legislature passed a new budget process for next year, requiring all state agencies to include supporting data and explanations when they submit budget requests to the Department of Management, and the Department of Management is then required to consult with the non-partisan Legislative Services Agency so information about each budget request is available to legislators.  That likely means all programs and funding requests will receive closer review.