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House and Senate Appropriations Committees Hear about Impact of ACA Repeal, Consolidation of State Human Services Agencies

March 08, 2017

On Tuesday, the House Appropriations Committee held its annual budget hearing with the Department of Human Services (DHS). Today, the Senate Appropriations Committee followed suit with a combined hearing for DHS, the Department of Health (DOH), the Department of Drug and Alcohol Programs (DDAP), and the Department of Aging. The House previously held individual hearings for the other three agencies.

For two days, House and Senate members asked questions about how proposed changes to the Affordable Care Act (ACA) would impact patients, hospitals, and other providers. The Governor’s proposal to merge DHS, DOH, DDAP and Aging into a single state Department of Health and Human Services also was a heavy focus for both committees.

Committee members in both chambers prompted DHS Secretary Ted Dallas to review exactly what the ACA has meant to the health of Pennsylvania families and patients.

Dallas reported that the ACA has resulted in roughly 716,000 Pennsylvanians having health insurance because of Medicaid expansion. He also said that 1.2 million children, 248,000 seniors, over 30,000 with disabilities, have coverage. Dallas told both committees that 124,000 individuals now have access to drug and alcohol treatment programs as a result of expansion. 

In addition, Dallas reminded both committees that roughly 400,000 Pennsylvanians have taken advantage of insurance exchange plans offered through the ACA.

Legislators in both chambers responded with concern when Dallas explained that it would take more than $2 billion in state funds to make up for lost federal funds if Medicaid expansion ended.

The Secretary shared that hospital uncompensated care was reduced by $92 million in the first year of expansion in the commonwealth.

With regard to the governor’s proposal to merge DHS, DOH, DDAP, and Aging into a single agency, the panel of secretaries told legislators that the proposal would result in $95 million in savings in fiscal year 2017–2018.  All of the agency heads who provided testimony reiterated that consolidation is not just about saving money, but also providing quality and efficient services. 

In both hearings, legislators in all four caucuses expressed concerns about the consolidation, with DDAP and Aging drawing the most attention. On both committees, there was bipartisan concern expressed about the timing of merging DDAP, given the opioid/heroin epidemic happening in the commonwealth. Legislators questioned the timing of the decision to place DDAP into a larger “bureaucracy”. 

The secretaries of the various agencies affirmed Governor Wolf’s dedication to addressing the issue of opioid abuse and how it remains a top priority. Acting DDAP Secretary Jennifer Smith, indicated that the governor intends to keep a cabinet-level position dedicated to addressing the opioid epidemic. 

One additional subject that drew significantattention was the procurement process for the commonwealth’s managed care providers (Health Choices). Members of both committees asked questions about the complications that arose during the bidding and awarding of the contracts, and how this is affecting implementation of the contracts. Members expressed trepidation over uncertainty in a process that will ultimately involve $12 billion in state contracts.

For additional information, please contact Stephanie Watkins, HAP’s vice-president state legislative advocacy or Scott Bishop, HAP’s senior vice-president legislative advocacy.

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