Gov. Sam Brownback in his first State of the State address pledged that his administration will shrink state government and "remake" the state's Medicaid program.
Medicaid, the second biggest draw on the state treasury after education spending, accounts for about 18 percent of the state general fund. The program covers about one in 10 Kansans with most of the money spent on providing medical or nursing care for the frail elderly or disabled. Medicaid also provides health insurance for children in low-income families.
"The program is growing faster than the economy," Brownback said. "Additional commitments required of us by Washington have set us on a path of unsustainable spending and lower-quality care. Rather than receiving dictation from Washington, I pledge to fight for Kansas solutions for Kansas health care needs."
The line drew applause from most of the assembled legislators and onlookers who crowded the galleries of the Kansas House chamber.
State of the State address
But the new governor offered no details about how he wants Medicaid remade.
"Under the leadership of Lt. Gov. Dr. Jeff Colyer, our administration will begin this month a collaborative effort to remake Medicaid and improve health care," he said. "If we are to keep our promises, quality must be improved for the patient. And for the taxpayers, costs must be controlled."
That message was warmly received by some.
“I am excited that the effort to meet the basic health care needs of all Kansans will be headed by a physician who also is our lieutenant governor and that it’s a high priority within the administration,” said Rep. Pat Colloton, a Leawood Republican.
Others seemed more skeptical and said they wanted more specifics.
Administration officials are scheduled to provide a series of budget briefings to legislative spending committees and the media on Thursday and more details about Medicaid and other broad references in the governor's speech might be forthcoming then.
In broad strokes, Brownback, a Republican, promised to cut overall state spending by more than $750 million in fiscal 2012. State spending in the current fiscal year, which ends June 30, is expected to be about $13.6 billion. About a third comes from federal aid.
"The $750-million figure is all funds," Senate President Steve Morris, R-Hugoton, said after the speech. "It’s primarily the reduction or loss in federal money. It’s not so much state money that’s being reduced."
State of the State address
Brownback also said he was dropping from the books 2,000 vacant state jobs in executive agencies and would submit Executive Reorganization Orders over the next several days eliminating eight state agencies. But he did not say which agencies were slated to go.
“I certainly assume the (Kansas) Health Policy Authority is one of the eight agencies,” said Rep. Bob Bethell, R-Alden.
But there was a lot of uncertain speculation among legislators about which agencies the new administration wants to axe. Some said they had heard the State Conservation Commission, the Animal Health Department and Kansas, Inc. were on the extinction or merger list.
The administration of Gov. Mark Parkinson, the previous governor, cut about $1 billion in state spending during his brief tenure. Those cuts left many positions at state agencies unfilled. Parkinson is a Democrat. Democratic lawmakers said Brownback would have to go a ways to cut budgets more than they had with the last governor.
"“I say ‘Welcome to the party," we’ve been cutting state spending for the last two years,” said Rep. Jim Ward, a Wichita Democrat, reacting to Brownback's remarks about shrinking government.
Parkinson "cut the state budget six times, with total cuts of $1 billion, more than any governor in Kansas history," said Senate Minority Leader Anthony Hensley, D-Topeka.
Brownback also said he would ask the Legislature to work with him to redo the state tax code with an eye toward reducing income taxes.
Among other high points:
The governor said his proposed budget would earmark $6 million to fund early education centers in the state's neediest school districts.
He said he wanted to create Rural Opportunity Zones. People who move from out of state to any of the state's most rapidly depopulating rural counties would be exempt from state income tax for five years. He said he also wanted businesses, large and small, to be able to deduct from taxes a higher percentage of "the cost of investment."
He said his budget recommendations will include a three-year, $105 million University Economic Growth Initiative for aviation, animal health, engineering and cancer research but the universities will have to match it 50 percent with private donations or by shifting funds from other university programs.