DHHS to Pause MaineCare Payments Until $118 Million from Controversial Spending Bill is Available

The Maine Department of Health and Human Services (DHHS) alerted providers last week that unless lawmakers approve the proposed supplemental spending bill for FY25, many MaineCare payments will temporarily be withheld.

This supplemental spending bill, known as LD 209, has proven to be controversial among lawmakers as it makes its way through the legislative process.

One of the largest line items in the bill is a nearly $118 million appropriation from the General Fund for MaineCare, Maine’s Medicaid program, which is currently underfunded.

According to the statements released this past week by DHHS, any delay in the receipt of this funding will result in a pause to many of the payments regularly made to providers.

While the proposed spending bill could be passed by a simple majority, as is the case with most legislation, lawmakers have been pursuing support from two-thirds of the Maine State Legislature in an attempt to give the bill an emergency designation, as this would allow it to take immediate effect.

Bills without this emergency designation are not able to take effect until 90 days after the Legislature adjourns for the session.

In statements released last week, DHHS argued that without immediate access to the supplemental funding included in this bill, the agency would need to begin withholding payments to providers by holding some payments and “capping weekly cycles.”

This would result in a number of payments being withheld entirely, while others would only be partially paid until additional funding became available.

More specifically, DHHS would:

• “Pay hospital prospective interim payments (PIPs) at 70 percent the normal level;
• Hold payment for all hospital claims greater than $50,000;
• Hold payment for large retail pharmacies and large durable medical equipment suppliers; and;
• Hold payment for out-of-state providers of hospital, ambulance, pharmacy, and durable medical equipment services.”

For most other types of payments, DHHS explains that they would implement a “first in first out” system, where payments would be made based on the order of the date they were received, up to a set weekly dollar amount.

The department goes on to note that “based on the complexity of this work, and the volatility and uncertainty of the situation,” all of this would be subject to change.

Click Here to Read the Full February 10 Statement

Plans to institute these holds and caps were reiterated and confirmed in a second message this past Friday.

“In order for the Department to access the necessary funding immediately, the budget must have the support of two-thirds of the Legislature,” DHHS said. “Until the funding is made available, the Department is continuing its planning to temporarily withhold certain provider payments.”

“The Legislature has the ability to avert MaineCare capping by passing an emergency supplemental budget to sufficiently fund MaineCare for the balance of this fiscal year,” the department continued. “We are hopeful that the Legislature pursues this course of action.”

Click Here to Read the Full February 14 Statement

The Appropriations and Financial Affairs Committee was shown to have unanimously supported an amended version of this spending package, but Rep. Ken Fredette (R-Newport) was absent from the late night committee session when the vote was taken.

Although Rep. Fredette had wanted to vote against the bill, the rules in place at the time prevented him from logging his opposition. These rules have since been unanimously updated, but Fredette’s intended vote was still unable to be recorded.

When the Committee’s Ought to Pass report was sent to the House for a vote, lawmakers fell starkly along partisan lines, with 74 Democrats and Independents voting in support of the package and 71 Republicans voting against it. This narrow win sent the spending bill to the Senate for concurrence.

Concurrence is the legislative term for agreement between the House and Senate on bill that has the same exact wording and expenditures in both Chambers. It is an essential step for a bill to advance to the governor’s desk and be signed into law. A bill left in non-concurrence dies between the chambers if they can’t agree on the final language.

The Senate similarly voted along partisan lines in support of the bill, resulting in a final tally of 20 to 14 in favor of the legislation.

After this initial passage, Republican lawmakers offered a handful of amendments to the bill, none of which were ultimately successful.

At the core of the debate over this supplemental budget bill are some minor welfare restrictions originally proposed by Gov. Janet Mills (D) and later backed by Republicans. More specifically, Part S of the original proposal would have placed limits on the state’s emergency rental assistance program.

Although Republicans supported this measure, Democratic lawmakers removed it from the version approved in the House, pushing GOP lawmakers to take a unanimous stand against the spending bill.

[RELATED: House Dems Punt on $120M Spending Bill After GOP Demands Stronger Welfare Reforms]

Gov. Mills issued a statement last week criticizing Republicans for opposing the budget, suggesting that there is “absolutely no need” to prevent the bill’s passage on an emergency basis.

“Despite operating under the illusion that they worked in ‘good faith’ on the supplemental budget, Republicans reneged on their part of the unanimous, bipartisan approval given by the Appropriations and Financial Affairs Committee last week,” Mills wrote.

“If they continue their opposition and do not support enactment of the supplemental budget, Republicans will force the Maine Department of Health and Human Services into the extraordinary position of having to cap payments to health care providers,” she continued.

“I want to be clear: there is absolutely no need to obstruct a 2/3 passage of this bill,” said Mills. “It will only hurt Maine people. Republicans would be wise to support passage of the supplemental budget now and ensure that Maine health care providers receive the payments they need in a timely way.”

“Once the supplemental is done, I will join them in vigorously pushing for much-needed reforms to General Assistance — something that I agree needs to happen — during negotiations on the biennial budget,” she concluded.

Click Here to Read Gov. Mills’ Full Statement

Republican leaders disagree with what many are calling strong-arm tactics by the governor.

“Just cutting a blank check is not the solution,” Senate Minority Leader Trey Stewart (R-Aroostook) said.

“This is entirely the result of the majority party’s decisions,” Rep. Kathy Javner (R-Chester) — ranking member of the Legislature’s Health and Human Services Committee — said in a statement to the Maine Wire.

“They have passed two consecutive majority budgets, choosing to spend irresponsibly rather than govern responsibly,” said Rep. Javner. “If payments to providers are delayed, the blame rests squarely on them.”

“Their overspending has consequences, and Maine’s healthcare system should not be forced to bear the burden of their fiscal mismanagement,” she concluded.

Should the supplemental appropriations bill continue to fall short of garnering support from two-thirds of the Legislature, multiple State House sources have suggested to the Maine Wire that parliamentary maneuvers may be undertaken in order to ensure that the funding included in this package be made available quickly, despite the lack of Republican support.

To do this, the Legislature would adjourn prematurely through a procedure know as sine die, allowing all bills passed up until that point to take effect in 90 days. While this would not have as immediate an impact as passing a version of the bill with bipartisan support, it would be faster than waiting until the natural end of the legislative session.

This was already done during the previous budget cycle so that there would be no lapse in state funding and no “government shutdown” after lawmakers passed a budget without Republican support.

The Legislature was then reconvened by Mills in a special session — invoking the “extraordinary occasion” provision of Maine’s constitution — so that it could finish its work.

[RELATED: Mills, State House Dems Poised to Approve $120 Million Spending Bill Using “Extraordinary Occasion” Maneuver]

This move was later litigated in court where plaintiffs alleged that it represented a violation of the state’s constitution.

The Maine Supreme Court ultimately dismissed the lawsuit, however, on the grounds that none of the parties in the case successfully demonstrated that they had standing to bring a case against the Mills and the Democratic leaders in the State Legislature.

The Justices note in their opinion that they while affirmed the lower court’s dismissal of the case, they did so only “on the ground that the plaintiffs lack standing,” meaning the state’s highest court did not delve into the merits of the case in their ruling.

[RELATED: Maine Supreme Court Dismisses Conservative Lawsuit Targeting Parliamentary Trick]

Because the Legislature is out for February break this week, no further action on the supplemental budget bill is expected until Tuesday, February 25 at the earliest.