Kentucky Senate Approves Measure To Balance Medicaid Budget, To Be Reconciled With House Version.

Senate approves measure to balance Medicaid budget
By ROGER ALFORD

FRANKFORT, Ky. (AP) -- Government programs that already have been slashed by more than $1 billion over the past three years could face yet another round of cuts to free up money for the Medicaid system.

Kentucky's Republican-controlled Senate voted 24-12 largely along party lines Wednesday to impose 2.26 percent across-the-board cuts, drawing harsh criticism from some in the Democratic minority who complained that the move could lead to layoffs in state agencies, local courthouses and school districts.

Only two Democrats, Ray Jones of Pikeville and Joey Pendleton of Hopkinsville, broke ranks with their party to vote with a unified GOP.

"The bottom line of it is this is a distasteful situation we find ourselves in, but it is the only responsible action that we can take at this juncture," said Senate President David Williams, R-Burkesville.

The Senate rejected a proposal by Gov. Steve Beshear's to shift $166.5 million from next fiscal year's budget to fill this year's Medicaid budget gap. Beshear's proposal would balance next year's budget with cost savings achieved through privatization of some Medicaid programs.

Sen. Walter Blevins, D-Morehead, said Beshear's proposal was the preferable fix because it would have spared cuts to public education.

"To some of my school districts in eastern Kentucky, it's going to mean loss of teachers," Blevins said. "We've cut and cut everything. Now we're getting to the bone."

Republicans opened themselves to political peril in upcoming elections by voting to cut school funding, which is considered sacred in a state that has pushed for decades to improve its education system.

Sen. Julie Denton, R-Louisville, said the proposed cuts are necessary to protect the Medicaid program that provides medical care to more than 800,000 poor, elderly and disabled Kentuckians.

"These are really tough times, and we're going to have to make some pretty tough decisions," said Denton, chairwoman of the Senate Health and Welfare Committee and a champion of the Medicaid program. " ... If we don't figure out how to get our budget under control, if we don't make some tough choices and just say, 'Hey, you've got to do what you've go to do,' it's going to be exponentially worse."

House Speaker Greg Stumbo, D-Prestonsburg, said a compromise will be necessary to meld the competing pieces of legislation.

"We're still analyzing both proposals trying to figure out if there is some way to come to some middle ground," Stumbo said. "I think there's a lot of room for compromise."

Beshear reacted strongly to the Senate's proposed Medicaid fix, saying it would require "painful and unnecessary cuts" to an array of government services, including public schools and universities, public safety and job creation.

"These cuts are not necessary when a viable alternative is available," Beshear said.

The governor had previously warned that failing to adopt his plan could force $600 million in cuts to Medicaid services (including loss of federal matching funds) at a time when Kentucky's economy is a mess, some 10 percent of the work force is unemployed, leaving more people in need of government medical care. He said that could force a reduction in payments to doctors and in medical services to Kentucky residents who depend on the program.

Sen. Gerald Neal, D-Louisville, urged negotiators who will be appointed to work out a compromise to be open minded about resolving the stark differences between the Republican and Democratic proposals.

"It is too serious for us to play games with," Neal said.