Walz-Flanagan human services budget proposal focuses on people

Governor Tim Walz’s budget proposes over $300 million in new health and human services investments to help Minnesotans stay healthy and safe, and to live in dignity.

Health care:
The health care provider tax provides about $700 million each year to provide affordable health care for about one million Minnesotans and other investments in healthy people and communities. Under current law, the provider tax is set to sunset in December 2019. Walz’s budget proposal repeals that end date, ensuring that Minnesotans continue to have access to the care they need to stay healthy.

Health insurance affordability:
Minnesotans who use MNsure to get health insurance in the individual market would be able to tap additional affordability tools under Walz’s plan that would roll out over several years. The governor’s budget proposal includes a direct subsidy to reduce monthly premiums by 20 percent, which is estimated to provide relief to about 80,000 Minnesotans. The plan also includes a state premium tax credit, which would help ensure Minnesotans do not have to pay more than 10 percent of their income for health insurance.

ONEcare MN:
The governor proposes a major package, called ONEcare MN, aimed at expanding access to high-quality health insurance in the individual market. This proposal would roll out over several years and includes:

  • A high-quality “platinum-level” health insurance plan that offers coverage similar to MinnesotaCare. Currently, this type of comprehensive plan is not available on MNsure.
  • Ensuring that “gold” and “silver” level health insurance plans are available in every region of the state. The state would monitor and analyze the markets, and take action to provide plans when needed to ensure availability.
  • Aligning prescription drug benefit administration across public health care programs to leverage purchasing power and make medicine more affordable.
  • Improving access to affordable dental care for people throughout the state.

Child care:
Minnesota’s Child Care Assistance Program (CCAP) brings down the cost of care for about 15,000 Minnesota families. Safe and affordable child care supports families by allowing parents to work while kids are in a supportive environment, and helps employers to find and keep the workers they need.

The governor’s proposal includes an additional $26 million for child care assistance in the FY 2020-21 biennium, which would serve about 1,000 additional families and cut the current waiting list in half. The proposal also includes increased reimbursements for child care providers, with an additional $9.4 million in the upcoming biennium and $90.6 million in FY 2022-23 to cover this bump. This is an important first step in making sure that providers are adequately reimbursed, which helps ensure families have choices for child care.

Walz’s proposal also includes $1 million for grants in FY 2020-21 to expand the availability of quality child care in underserved areas. These grants, administered by DEED, would target regions with documented child care and workforce shortages. Funding would help child care providers get up to speed on licensing, regulations, training, facilities, and other business-related issues.

Cash assistance:
Walz’s budget includes an important and long overdue step to support Minnesota’s most struggling families on the path to economic security. Families receiving cash grants from the Minnesota Family Investment Program (MFIP) and the Diversionary Work Program (DWP) would see an additional $100 per month – the first increase in 32 years. The governor’s proposal includes $43 million in FY 2020-21 and $62 million in FY 2022-23 to cover the increase.

Opioid epidemic:
The governor’s budget contains a multipronged method to address the opioid epidemic, including culturally competent services, Naloxone supplies and training, local community engagement, and improved access to treatment and services. This approach would be headed by a stewardship advisory council and funded by a fee on opioid manufacturers and distributors. These fees are projected to raise $18 million per year.

Protection for vulnerable adults:
The proposed budget includes nearly $4 million in grants to safeguard vulnerable adults and make enhancements to the Minnesota Adult Abuse Reporting Center. It also includes expansions for the Ombudsman for Long-Term Care, regulatory reforms for assisted living facilities, adult day center oversight, and more.

Mental health:
A focus on mental health is very present in the proposal. Walz’s budget would increase school-based mental health grants to serve 7,000 more students, and would expand and improve children’s intensive in-patient services. Also, the plan includes investments in community behavioral health clinics, rural counseling services, and improvements to better align mental health and substance abuse disorder treatment.

Disability services:
Walz’s proposed budget includes pay increases for people who care for people living with disabilities. Under the plan, formulas used to calculate wages for people who provide home and community-based services would include a “competitive workforce factor.” This adjustment is intended to make wages more aligned with competing jobs, and clocks in at nearly $18 million for the biennium. Additionally, Personal Care Attendants, who provide support to ensure Minnesotans can live in home or in their communities based on their individual preferences, would also see an increase in minimum pay, holidays, and basic time off.

Child welfare:
The governor’s proposed budget includes investments in child welfare statewide, including regional development hubs, a training academy, prevention grants, and a fix to address health care coverage gaps for kids in foster care. The plan also includes $8.2 million in FY 2020-21 and $19 million in FY 2022-23 to expand the American Indian Child Welfare Initiative, which supports tribal delivery of child welfare and child abuse prevention for American Indian kids and families.

Reinsurance remainder:
The proposed budget also includes the technical transfer of funds leftover after the conclusion of the Minnesota Premium Security Plan, also known as reinsurance, which provided payments to health insurance companies to offset costs in the individual health insurance market. This program is set to end in 2019, resulting in final payments to insurers in August 2020. The remainder, estimated at $281.4 million, would be transferred to the Health Care Access Fund. There, it would support health care access and public health activities.

Overall:
The Minnesota Budget Project is pleased that some of our policy priorities, like maintaining the provider tax and investments in affordable health care, child care, and family economic stability, are included in the governor’s proposed budget. While the proposal is just the first stage in the lengthy process of creating the state budget, it’s a meaningful statement and contains important elements for Minnesota’s kids, families, and workers.

-Betsy Hammer

About Betsy Hammer

Betsy Hammer is the Minnesota Budget Project's policy advocate.
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