Malloy vetoes Medicare program fix, calls it ‘wishful’ budgeting

In a largely symbolic act, Gov. Dannel P. Malloy vetoed a bipartisan bill Monday to reverse cuts to the Medicare Savings Program, calling it an unbalanced exercise in “wishful thinking” that only would worsen projected budget deficits.

Malloy, who already had deferred any restrictions to the Medicare program until June 30, has acknowledged legislators probably will override his veto.

The House and Senate both passed the budget adjustment bill with veto-proof, bipartisan margins in special session on Jan. 8.

Legislative leaders said at that time that if Malloy carried out his veto threat, they would call lawmakers back in to override the governor.

“The bipartisan budget changes adopted to fund the Medicare Savings Plan are wishful thinking, double counting and pushing off problems into the future,” Malloy wrote in his veto message. “This bill has essentially done nothing to the state’s budget operations in order to fund the restoration of the Medicare Savings Plan by either adding new revenue or reducing state spending levels.”

At issue is a program that uses Medicaid funds to help poor elderly and disabled patients pay for health care costs that Medicare does not cover, and new eligibility limits for it that lawmakers wrote into the new state budget and ordered to take effect Jan. 1. This was projected to save $54 million this fiscal year and about $130 million in 2018-19.

Encountering fierce resistance back in their districts amid projections that as many as 113,000 patients could lose some or all of their assistance, lawmakers planned to defer the new restrictions at least until the next fiscal year begins on July 1.

Malloy beat them to the punch, using the state Department of Social Services’ authority as administrator of the federal Medicaid program in Connecticut to suspend implementation of any eligibility rule changes until July 1.

But lawmakers still resolved to reverse the cutbacks through June 30 themselves.

The governor, meanwhile, instead asked the legislature to focus on mitigating a projected $224 million budget shortfall for this fiscal year. That deficit has not been addressed yet.

Further complicating matters, Malloy insists the steps lawmakers took to restore the $54 million taken from the Medicare Savings Plan are fiscally dishonest.

Legislators found the extra $54 million for the Medicare program this fiscal year by:

• Canceling a previously ordered transfer of $17.8 million from this fiscal year to the next. But state finances next fiscal year already are at risk of deficit by more than $200 million because of declining revenue projections.
• Reducing the state’s contribution this fiscal year to the teachers’ pension fund by $19.4 million. But the budget already assumes the state will save $19.4 million in this area because it increases what teachers must set aside for their pensions.
• Reducing accounts for executive appointments, miscellaneous agency expenses and from the Department of Administrative Services. The governor has questioned whether these cutbacks can be achieved in the remaining six months of the fiscal year, since the new budget already has forced major cutbacks in these areas.

Still, the House voted 130-3 to adopt the budget adjustment bill on Jan. 8, and the Senate approved it 32-1. Both tallies easily exceed the two-thirds margins that would have to be duplicated to override the governor’s vetoes.

House Minority Leader Themis Klarides, R-Derby, said Monday “It is unsurprising, but unfortunate, that the governor has added to the angst of more than 100,000 Connecticut seniors and disabled with this veto. On the one hand, the Governor blocks statutory assurance that these most at-risk people will receive the benefits they rely upon.”

“This (veto) is not unexpected, as was the overwhelming vote in the legislature,” said House Speaker Joe Aresimowitz, D-Berlin. “The bottom line is that the thousands of affected residents can rest assure that they will continue to have access to the Medicare Savings Program through the current fiscal year.”