Doubts swirl over Medicaid agreement

“It doesn’t look like we are going to compromise this issue at this given time,” said House Public Health Committee Chairman Steve Holland, D-Plantersville.
Lt. Gov. Phil Bryant continued to display optimism that the issue that has bogged down the special session could be resolved. But Holland said Bryant’s proposal to make a reduction in the income tax part of the solution would be too volatile to take up during the special session.

According to House leaders, Bryant has proposed increasing the taxes on hospitals to raise $90 million for the Medicaid deficit and increasing the tax on cigarettes as a way to reduce the income tax and to provide additional funds for Medicaid.

Bryant confirmed Thursday that he proposed cutting the income tax as part of the solution to funding the deficit, but said he did not intend that plan to be made public. He said it was meant to be part of the private negotiations between House and Senate leaders, but added it is a good plan.

“What I was trying to do was open discussions for a lot of different options,” Bryant said. “… I am exploring every option I can.”

The Senate and the governor support increasing the hospital tax to fund the deficit. The House leadership has expressed support for a cigarette tax to fund the deficit.

Barbour has said he would cut Medicaid if the House did not pass the cigarette tax. The House has passed legislation, pending in the Senate, that would prevent the governor from making cuts until well into the 2009 regular session, giving legislators time to deal with the issue then.

Holland said there is no need for the governor to cut now.

“In 2005, we had a $240 million deficit, and he did not talk about cutting a dime, and we (legislators) took care of it just like we will this time,” Holland said.

During a Senate hearing on the House legislation that would block Barbour from making cuts, Medicaid

Executive Director Robert Robinson said the governor
had to act because state law requires it.

Sen. David Blount, D-Jackson, pointed out there was a deficit last year of $90 million and the governor did not cut then.

Treasurer Tate Reeves urged the legislators to solve the problem now – by using the hospital tax – because if they wait until January to fund the deficit, they will have to use one-time money. He said with the economy struggling a permanent fix is needed.

NE MS Daily Journal
7/4/8