Here in Alabama we have an election coming up on September 18th to decide whether or not Medicaid will stay solvent in Alabama. Not expand as outlined in the Affordable Care Act but exist as a care delivery vehicle for poor people. I alluded to this situation previously. In a nutshell, the deeply conservative legislature passed a budget that did not include sufficient funding for Medicaid as written. Instead, a constitutional amendment is required to allow funds to be moved from the “rainy day” fund to the general fund in order for the budget to become balanced. The governor has said there is no plan B, should the Amendment not pass.
I will say, the Amendment has been worded as strongly as it can be to create a sense of urgency including the phrase “to prevent the mass release of prisoners.” Part of that sense of urgency, however, is very real. As the Lieutenant Governor points out:
If the voters decide not to pass the proposed amendment, several options would have to be considered. One is proration and the other is raising taxes to meet General Fund obligations.
The Governor and legislative leaders have stated they WILL NOT propose a tax increase. The Lt Governor goes on to say:
Additional cuts to agencies will impact real people and real lives…not just “services”. For example, if Medicaid is under-funded, it could result in Alabama being in non-compliance and losing millions in federal dollars. Loss of Medicaid services will severely impact nursing homes, state human service agencies and many hospitals, including Children’s Hospital in Birmingham. Thousands of prisoners would be slated for early release, mental health services reduced, Public Safety – fewer troopers to protect us and the list goes on… These are the facts. The voters of Alabama will be the final voice on September 18 in deciding how Alabama meets its General Fund obligation.
The opposition, as quoted here, is led by former gubernatorial candidate Tim James:
“We just can’t, we just can’t continue to spend more money than we have,” said James. “The trust fund was establish by my father (former Gov. Fob James) and Gov. (George) Wallace as a sacred trust where dollars would be put and used only for the most critical needs, the most pressing emergencies. This is not such an emergency. I don’t understand how Republicans can champion borrowing money to balance the budget. They should make the hard choices now and cut spending and then live within our means.”
The Alabama budget is heavily earmarked. The General Fund, where state portion of Medicaid is budgeted, relies on the interest from this trust fund to offset a lack of predictable revenue. In other words, this will spend down the principal and make next year’s budget even harder to meet.
I feel that Alabama Arise’s position, a qualified endorsement of a Yes vote, is probable the best position to take. As they point out:
[A]voiding short-term devastation is not a long-term answer to the General Fund’s chronic shortfalls. The amendment’s passage would not end the need for tax reform to ensure Alabama can provide adequate and reliable funding for the public structures that make the state a better place to live and work for everyone.
Wish Alabama luck.