The House Ways & Means Committee last Wednesday released its FY2020 $42.7 billion proposed state budget. The House proposal is just $1.8 million less than the budget total Governor Baker offered in January.
Following Governor Baker’s blueprint for MassHealth spending, hospital reimbursement will remain essentially flat relative to FY2019 rates, which therefore continues a significant rate reduction that was introduced in the 2019 MassHealth contract with hospitals, or “RFA.” The House requires supplemental funding for disproportionate share hospitals at $13 million, which is the amount assumed in the administration’s FY2020 budget proposal. Like the governor’s proposal but with further limitations, the House budget plan contains language giving the state more authority to negotiate with pharmaceutical manufacturers for MassHealth-reimbursed drugs – a proposal the hospital community supports.
The Health Policy Commission – a state regulatory agency that is funded by hospitals, insurers and ambulatory surgical centers, but not by the state itself – would have its budget increase 8.7% to $9.5 million under the House Ways & Means budget.