NH lawmakers OK $10.7B budget, Medicaid study

CONCORD, N.H. (AP) -- The New Hampshire Legislature passed a $10.7 billion bipartisan budget Wednesday that eases the waiting time for services to the disabled and mentally ill, but puts off a decision on whether to expand Medicaid to 58,000 poor adults.

The Senate voted unanimously to pass the budget, followed by the House passing each bill in the two-bill package by over 300 votes.

"The large, bipartisan support for the priorities in this budget — caring for our most vulnerable, public safety, education and preserving our natural resources — demonstrates that our shared values as Granite Staters are far more significant than our differences," Gov. Maggie Hassan said in a statement.

The package creates a nine-member commission to study expanding Medicaid and issue a report Oct. 15. Hassan has said a special legislative session may be needed in the fall to authorize expanding Medicaid under the new federal health care law.

Republicans praised the budget for containing no new tax increases, though it counts on money from a 10 cent increase in the cigarette tax automatically due to take effect this summer. Democrats praised it for providing more aid to colleges and college scholarships and increasing funding for social services.

Sen. David Pierce, D-Etna, said the bipartisan budget contained many good things, but warned that it fails to deal with deteriorating highways, forces $10 million in cuts to state employees and $7 million in cuts at the Department of Health and Human Services and does not guarantee Medicaid expansion. He called on his colleagues to work next year to address the issues.

"We will undo much of the good if we go loudly (with praise of spending) with one hand and take away silently with the other," he said.

Senate Finance Chairman Chuck Morse, R-Salem, said it will be up to Hassan to manage the spending in the budget.

"We're here to help but we're not here to raise revenues," he said.

Expanding Medicaid was the last big hurdle to reach a compromise last week.

The Republican-led Senate negotiating team and Democratic-House team traded several proposals on Medicaid expansion before agreeing to establish a commission to study the impact expansion would have on the state and possible alternatives, such as using federal funding to buy private insurance for some.

States can choose to expand Medicaid as part of a key component of the federal health care overhaul, which will be fully implemented Jan. 1. If New Hampshire were to expand the program, the U.S. government would pick up the full cost for the first three years and 90 percent over the long haul. States can withdraw from covering adults at any time without penalty.

New Hampshire's Medicaid program covers low-income children, parents with nondisabled children under 18, pregnant women, senior citizens and people with disabilities. The expansion would add anyone under age 65 who earns up to 138 percent of federal poverty guidelines, which is about $15,000 for a single adult.

Legislative leaders could call a special session to vote to authorize expansion after the commission files its report, but the Senate would not agree to a firm date as the House wanted. Hassan also could call lawmakers into special session — a move she indicated might be needed to ensure New Hampshire starts the program Jan. 1 to begin capturing the estimated $2.5 billion in federal funding the state would get over seven years.

The House and Senate largely had agreed on spending priorities entering negotiations. Besides increases in funding for higher education and services for the mentally ill and disabled, the budget also funds four new charter schools.

The budget contains money for state workers' first pay raise in 4 1/2 years, but the deal negotiated with the largest union is in jeopardy after union leaders voted not to recommend a ratification vote largely over a new health care deductible and sent negotiators back to the table.

To help pay for the spending, the budget requires the Department of Health and Human Services to cut $7 million out of its budget and the governor to cut $25 million in staff and benefits with $10 million coming from state-tax supported workers. The state employees' union said that will result in an unknown number of layoffs.

The Senate had insisted on no tax increases and rejected a 20-cent cigarette tax increase and a delay in implementing tax breaks for businesses, both proposed by the House and governor.