Republicans in the Maine Senate are demanding reforms to the state’s MaineCare program after their last-minute vote late Tuesday blocking a compromise plan to balance the state budget and maintain payments to health care providers.

Democrats have previously opposed the reforms and indicated Wednesday that they will push Senate Republicans to accept the existing deal when they convene Thursday for a newly scheduled session. It remains to be seen if the two sides can come together in some other way.

The Senate will meet Thursday at 11 a.m. — two days after a compromise proposal received initial bipartisan support in both the Senate and House of Representatives, only to fall apart when the Senate took the measure up for final enactment.

Nine Republicans who had supported a compromise amendment ended up opposing the bill on the final vote, which the Senate failed to enact as an emergency measure, voting 22-11 — two votes short of the 24 needed for two-thirds support in the 35-seat chamber.

The bulk of the $121 million supplemental budget contains funding for the MaineCare program that is needed to avoid reducing payments to hospitals, clinics and pharmacies for care provided to patients enrolled in the public insurance program. MaineCare is $118 million short of the funding it will need through the end of the fiscal year on June 30.

The state Department of Health and Human Services has already started curtailing some payments in this week’s pay cycle because of the delays to date in approving supplemental funding.

Gov. Janet Mills criticized Senate Republicans’ move on Wednesday, saying the MaineCare funding is critically needed in order to prevent further payment delays.

“The failure of the supplemental budget to earn two-thirds support in the Senate is a grave disappointment,” Mills said in a written statement Wednesday morning. “Senate Republicans turned away from bipartisan agreement — unlike their House counterparts — and are causing harm to Maine health care providers and patients.”

REPUBLICANS SAY ISSUES REMAIN

Senate Republicans said in a statement Wednesday that the budget proposal fails to address the issues that led to the MaineCare shortfall and that in order to win their support, the bill would need to include “concrete initiatives to safeguard MaineCare’s long-term sustainability.”

Republicans specifically mentioned two measures they previously introduced as amendments to the bill but that were rejected by Democrats: a freeze on MaineCare enrollments for “able-bodied” adults until enrollment falls by 10%, and a requirement for work, education or community service for childless adults without a documented disability.

“It’s unfortunate that Democrats want to continue to ignore our concerns surrounding the core policy issues that precipitated the MaineCare shortfall,” Senate Minority Leader Trey Stewart, R-Presque Isle, said in a written statement. “I have made it very clear to my Democrat colleagues that without substantive welfare reform, there would not be enough votes from my caucus to ensure two-thirds passage of the budget in the Senate.” 

Senate President Mattie Daughtry, D-Brunswick, on Wednesday accused Republicans of “moving the goalpost” with their effort to force the MaineCare proposals into the bill after the bill had already been amended to win their support.

Nearly all of the $121 million supplemental budget is dedicated to closing a $118 million deficit in MaineCare costs through June, the end of the current fiscal year. Another $2 million is proposed to fight spruce budworm infestations threatening Maine forests.

The version approved by the House and that received initial support from the Senate also includes a compromise amendment with new limits on housing assistance, a requirement for an independent audit to look “for fraud, waste and abuse” in the MaineCare program and cost-of-living pay increases for direct care workers, which all stem from priorities Republicans had pushed for.

“It’s not that I don’t want to negotiate,” Daughtry said. “We’ve been negotiating constantly and have shown our ability to work together. Why would you continue a conversation if you don’t know what the end of the road is?”

She said Democrats have concerns about including substantial MaineCare changes in the supplemental budget, an emergency bill aimed at filling gaps in the current fiscal year, when there have been no public hearings or committee work done on the proposals. Daughtry also cited concerns about increased costs and increased bureaucracy from the proposals.

“Speaker Fecteau and I have made it clear that these would not be able to go through our caucuses,” Daughtry said, referring to House Speaker Ryan Fecteau, D-Biddeford.

WHAT HAPPENS NEXT?

The bill is expected to come back before the Senate on Thursday because the House voted Tuesday night to stand by its previous votes to effectively insist that the Senate follow its lead.

Senate Republicans voted 31-2 in favor of the compromise amendment and then gave the amended bill initial approval without a roll call and sent it to the House. Roll calls are typically requested when there is significant opposition to a bill so lawmakers can formally register their votes.

Stewart said Tuesday night that Senate Republicans’ support for the amendment was an agreement to “make a bad bill less bad,” but shouldn’t have been taken as an indication of overall support for the package. He said he had been clear with Daughtry that there were only two members of his caucus who were interested in supporting the overall bill.

And a spokesperson for Senate Republicans said Wednesday that the move to send the bill to the House without objections was a procedural move to allow the House to adopt the amendment.

Daughtry has said, however, that she was surprised with how the final vote unfolded. “It feels disingenuous to say, ‘We like the amendment, but we’re not going to enact it,'” she said.

It was unclear Wednesday afternoon what action the Senate might take Thursday. “The reason we’re calling folks back in is because we’re beyond out of time,” Daughtry said.

One option, Daughtry said, is for the Senate to “recede and concur” to align with the outcome in the House by giving Senate Republicans another opportunity to vote in favor of the amended bill.

“This was supposed to be passed a month and a half ago,” Daughtry said. “Any compromise or negotiation requires bringing each caucus a little bit closer. We might not all agree. … But there’s a limit where you can only push folks so far. I can only bring my caucus to a certain point.”

CURTAILMENTS IN EFFECT

Failure to pass the legislation on an emergency basis means the Maine Department of Health and Human Services is now having to reduce MaineCare payments owed to health care providers.

Starting Wednesday, the Department of Health and Human Services is paying only 70% of prospective interim payments to critical access hospitals, while withholding payments for all hospital claims greater than $50,000 and payments to large retail pharmacies, large durable medical equipment providers, and out-of-state providers of hospital, ambulance, pharmacy and durable medical equipment services.

Critical access hospitals are smaller, isolated, rural community hospitals designated by the federal government to receive higher reimbursement rates for Medicare and Medicaid, while prospective interim payments provide a steady source of revenue so these facilities can pay fixed expenses throughout the year.

The department also notified pharmacies Tuesday that absent action by lawmakers they would be temporarily withhold payment for multistate chain, large health system, and out-of-state retail pharmacies starting with Wednesday’s pay cycle.

A spokesperson for the department said they do not have information yet on when they will be able to release held payments, and that the timing depends in part on any action by the Legislature. Legislative action to pass a supplemental budget on an emergency basis would need to happen before Friday in order to impact next week’s payment cycle.

Jeff Austin, vice president of government affairs and communications for the Maine Hospital Association, said Wednesday that Maine hospitals have some of the lowest operating margins in the country and that his organization is hearing a lot of concern, especially from members who have low “cash on hand.”

“The money that flows into hospitals — like MaineCare payments — flows right back out in the form of salaries for nurses, payments to local vendors and costs like pharmaceuticals,” Austin said in an email. “We want to believe that the Legislature will find a way to pass the supplemental budget, but in the interim, pain will be felt.”

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