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Budget Chairman Clouse Gives First Look at General Fund Budget

House Ways and Means General Fund Budget Chairman Rep. Steve Clouse today said Medicaid will dominate discussion of the 2017-18 General Fund budget that should begin on its path toward final passage next week.

The Business Council of Alabama schedules Tuesday briefings each week during regular legislative sessions for BCA members and features legislators and policy makers.

Today’s briefing, the fourth of the 2017 legislative session, was sponsored by the Chamber of Commerce Association of Alabama that unites about 120 local chambers of commerce and the BCA in The Partnership that is now in its 14th year.

CCAA President Jeremy Arthur introduced Rep. Clouse, R-Ozark.

Rep. Clouse said the proposed General Fund budget would allocate of $805 million for Medicaid, a $20 million increase from this year’s appropriation. Most other state agencies will be level-funded with only a few receiving increases in the give-and-take of Alabama budgeting, he said.

“We’ll see if we can hold that together,” Rep. Clouse said.

Proposed General Fund budgets have been introduced in the House and Senate – HB 155  and SB 150 and should start being debated in the committee next week, Rep. Clouse said.

Medicaid and state prison funding dominate General Fund issues each year as the House and Senate struggle to find appropriations for general government functions. “Reflecting on the General Fund, it’s never in good shape and it will never be in good shape,” Rep. Clouse said.

Medicaid, the $7.3 billion combined state-federal medical insurance program, has been the centerpiece of every General Fund budget for at least the last 10 years, Rep. Clouse said.

Rep. Clouse reviewed the Medicaid budgets over the past decade: In 2007, Medicaid received $399 million in state discretionary dollars and this year received $785 million, a 97 percent increase. (This year’s Medicaid appropriation included $85 million in a 2016 special legislative session.);

Inflation in the last 10 years has totaled under 20 percent while Medicaid has also grown exponentially from 2007-2015 during a stagnant economy. In 2007, 756,000 Alabamians were receiving Medicaid benefits. Two years ago, the latest year available, 995,000 Alabamians received benefits.

With state dollars and borrowing from other funds, legislators have managed to cobble together a General Fund budget every year, but it’s virtually always at smaller levels than what executive branch agencies request. (To the Legislature’s credit and to voters demanding it, borrowed money is being repaid.)

Rep. Clouse later said the Affordable Care Act, which is known as ObamaCare, has not taken any pressure off Medicaid since it became law in 2010.

Clouse said Medicaid’s future in Alabama will depend a lot on President Trump, who vows to repeal ObamaCare. President Trump is to deliver his first State of the Union address tonight to a joint session of Congress.

“Everything comes down to health care,” Rep. Clouse said. “We’re looking to Washington to see what happens to Medicaid (and) what happens to the Affordable Care Act.

“It’s a major issue in all the states,” Rep. Clouse said

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