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By By DAN PARSONS,Staff Writer
With the passage of its 2007-2009 budget, the General Assembly reached a helping hand to local governments by lifting some of the Medicaid burden from the shoulders of the 100 counties.
In that budget the state agreed to assume 25 percent, or at least $500,000, of the counties’ Medicaid expense in the current fiscal year. The state will then increase its share of each county’s Medicaid expense by 25 percent for the next three years, according to the state budget.
Details of the county-state funding arrangement also involve counties returning to the state various funds from other sources, such as average daily membership funding for schools, each year until the Medicaid burden is fully assumed by the state.
Crunching the numbers for their own budgets prior to the fiscal year begun July 1, area counties struggled to budget around the relief that was not then a sure thing.
Almost a month into the current fiscal year, the Martin County Board of Commissioners approved a budget adjusted for Medicaid relief specified in the state budget passed the same day. Anticipating what Martin County Manager Russell Overman called “substantial Medicaid relief from the state,” he proposed to the board budgeting $1.3 million for Medicaid expenses for the current fiscal year begun July 1.
0002000005A30000055159D,“I want you all to be aware that this budget includes Medicaid relief per the state House budget,” Overman said at a May budgeting workshop. “I don’t necessarily like doing that because it hasn’t been approved yet. If we do not get Medicaid relief at least to the tune of the House budget, services and people are going to have to be cut out of this budget.”
With estimated county Medicaid expenses at nearly $2.9 million for the fiscal year and only $500,000 in state relief after the General Assembly passed its budget, Martin County’s proposed budget met with a $1.2 million shortfall. Commissioners were then forced to revise their budget in accordance with state relief.
Beaufort County typically spends between $3.5 million and $3.8 million annually on Medicaid each year. A fourth of its residents are eligible for the program. Estimates indicated the county may have had to put as much as $4.5 million toward the program this fiscal year. It will receive a fourth of the budgeted total Medicaid expenditure from the state this fiscal year.
Medicaid drafts in Washington County for fiscal year 2006-2007 rose $199,000 over the previous year, according to documents from county manager David Peoples. The county budgeted $1.27 million for the program this year, but expenses could top $1.54 million in that county. Washington County also received the minimum $500,000 in relief, not enough to cover its Medicaid costs this year.
00020000092000000AEE91A,Counties were previously required to pay 15 percent of the Medicaid funding that it receives from the state. That percentage, for Washington County, has had a $1.17 million cap placed on it previous to this year. Once the county has paid out that amount for Medicaid, it was able to tap into a one-time appropriation of $27 million in budget surplus which had been set aside to help counties out with their Medicaid bills. Looking to future budget seasons, county officials still thirsted for permanent relief.
Also included in the Medicaid relief package was an authorization for the counties to levy one of two new taxes pending approval by county residents. The taxes would provide alternate funding sources to offset rising Medicaid costs without raising proerty-tax rates. They were an up-to 1 percent land-transfer tax or a quarter-sent sales tax.
Washington County commissioners proposed the transfer tax while Martin County commissioners chose to hold a referendum on the sales tax.
Washington County residents, like those in all other counties where the transfer tax was put to a vote, overwhelmingly denied their commissioners the ability to levy a land-transfer tax in November. The referendum failed with 1,629 votes against and 651 votes for the up-to 1 percent tax on real estate sales in the county.
Peoples, a staunch advocate for the transfer tax in his county, lamented the tax’s failure to win public approval.
Peoples said the tax would “give the county tools to grow” and would help curb declining trends in population and employment rates.
Martin County Manager Mort Hurst has been a vocal opponent to the Medicaid relief program, often saying that it “is no relief at all.”
Poorer counties whose Medicaid costs are lower but still a major portion of their annual budgets may not see substantial relief until the state bites off a bigger piece of Medicaid costs in subsequent years.