Session for Medicare fix delayed until early January

State legislative leaders Tuesday again delayed their plans to reverse cuts to the Medicare Savings Program in December, but pledged to restore all funds in early January.

Democratic and Republican leaders of the House and Senate, who had petitioned the General Assembly into special session between Dec. 24 and 29, said they now hope to gather the full legislature on Jan. 4 or 5.

Despite the latest delay, House Speaker Joe Aresimowicz, D-Berlin, said there is bipartisan resolve to reverse cuts to the popular social services program, which uses Medicaid funds to pay medical expenses that Medicare doesn’t cover.

“Many of us have heard from our constituents and our colleagues in the legislature that this is a major issue,” Aresimowicz said. “We will deal with that sooner rather than later.”

“We are ready to address the cuts,” said House Minority Leader Themis Klarides, R-Derby. “The problem is it’s Christmas week so there are people away. This is a very important issue to many people that represent their districts, and we want them to be able to be here to vote on it.”

Leaders said they have reached a tentative agreement to redistribute about $54 million from other line items in the budget to shore up the Medicare Savings Program. Otherwise an estimated 113,000 low-income seniors and disabled would lose some or all of the assistance they currently get starting in late February.

Seeking $54M for Medicare Savings Program

Legislative leaders had been targeting accounts for overtime, executive appointments and “other expenses” in various agency budgets to provide the $54 million that would be restored to the social services program.

That put lawmakers at odds with Gov. Dannel P. Malloy, whose administration argued that savings tied to overtime and other labor costs already are accounted for in the budget.

When they adopted the new, two-year state budget in late October, legislators directed the governor to achieve unprecedented savings once the budget was in force, and the administration also has warned it would be very difficult to carve major savings out of “other expenses” line items. Agencies already have been told to hold back considerable spending in these accounts to hit the savings targets mandated in the budget.

Cuts to ‘other expenses’ could mean programs

Further complicating matters, these “other expenses” accounts are used to pay for more than various equipment purchases, legal services, consulting contracts and other miscellaneous expenses.

Many agencies also fund small-yet-popular programs that don’t have their own, separate line items in the state budget.

These include such programs as ecological protections, day care and school readiness services, nutritional assistance, a health and social services referral operation, and both medical and cash assistance programs for the developmentally disabled.

In other words, rank-and-file legislators might believe they simply are cutting omnibus “other expenses” accounts without realizing they could be cutting some social services to bolster others.

Klarides said nonpartisan analysts recently briefed legislative leaders, indicating that some of the leaders’ original plans to redirect funds could not be achieved.

She added leaders have crafted a new plan to transfer funds into the Medicare Savings Program, but neither Klarides nor other leaders said what other line items might be reduced.

Budget deficit remains to be resolved

Malloy also has been bumping heads with legislative leaders because he wants them to act quickly to mitigate a projected $208 million deficit in state finances.

Time is of the essence for the governor, whose administration believes that by mid-January at the earliest, or late April at the latest, Connecticut’s revenue outlook is likely to worsen. Specifically the administration is concerned projected state income and sales tax receipts could fall short of targets, expanding the deficit.

And the larger that shortfall gets in the state election year of 2018, the greater the temptation will be for lawmakers to tap emergency reserves or balance the budget by borrowing, kicking the problem onto the next governor and legislature.

Malloy also challenged legislators this month to bolster resources for a state transportation program otherwise headed for major contraction, deficits and insolvency in the coming years.

“We hope that this extra time will allow legislative leaders to proceed thoughtfully,” Malloy spokeswoman Kelly Donnelly said Tuesday. “To be clear, we think the best option is for the legislature to come in and address the full deficit, including the very real problems facing our Special Transportation Fund. … If they choose to only address Medicare eligibility, we urge them to pay for those changes with real spending cuts — not vague, undefined, or flat-out unachievable savings that will only drive up the deficit.”

Senate President Pro Tem Martin M. Looney, D-New Haven, said he is confident both parties are prepared to tackle the budget deficit once the Medicare Savings Program issue has been resolved, just as both parties cooperated last October to adopt a budget.

“We believe any deficit mitigation plan of necessity is going to have to be bipartisan as well,” he said.

Klarides said all legislative caucuses already have been at work developing ideas to shrink the budget shortfall.

Hopes for a December session fell apart

Legislative leaders originally hoped to hold a Dec. 19 session — only to reverse the Medicare program cuts. The quickest way for the legislature to return would have been a summons by the governor. But Malloy wasn’t interested in helping if lawmakers planned to postpone action on the budget deficit.

Legislators then began the lengthier process of petitioning themselves into session. But leaders couldn’t agree on a target date — with some favoring Dec. 22 and others early January.

Based on the date those petitions were submitted last week, and a process spelled out in statute, Secretary of the State Denise Merrill announced the session must begin sometime between Dec. 24 and 29.

But Senate Democratic leaders told other caucus leaders Tuesday that time frame didn’t work.

Leaders then agreed to use a technical maneuver to reach a compromise.

Both the House and Senate technically will meet on Dec. 29 — but only a handful of lawmakers will gather in each chamber with only one order of business. Both will vote to extend the emergency session to a yet-unspecified date, on or about Jan. 4 or 5, to restore the Medicare Savings Program cut.