I am writing today to announce the closure of the New Mexico Independent. After three and a half years of operation in New Mexico, the board of the American Independent News Network, has decided to shift publication of its news…
New Mexicans prefer cuts to tax increases, Journal poll says; Advocates protest cuts to Medicaid
More New Mexicans prefer spending cuts to tax increases to balance the state’s nearly $5.5 billion budget, according to the results of an Albuquerque Journal poll released today. But some advocates say they’d rather see the repeal of tax cuts than cuts to Medicaid. One in four New Mexicans gets health coverage in whole or part through some form of public assistance.
Fifty-eight percent of the voters polled statewide told Research and Polling Inc. that they preferred cuts compared to 21 percent who said they favored tax increases. Another 9 percent said both methods should be used.
Projections are that the state faces a $440 million shortfall for the fiscal year that ends June 30, although some lawmakers already are estimating that the gap might grow to $550 million.
Gov. Bill Richardson already has said he won’t repeal the 2003 law that reduced the state’s income tax for top earners from 8.2 percent to 4.9 percent to address the budget shortfall.
Richardson is joined by some top lawmakers from both political parties, as well as business groups, who say the last thing New Mexico should do during a deep recession is to pass broad-based tax increases to balance this year’s budget.
“The last thing we need is to take any money out of people’s pockets. We need to take some money out of government’s pocket,” the Journal quotes Senate Minority Leader Stuart Ingle, R-Portales, as saying in today’s story.
Public employee unions and advocates for low-income New Mexicans, meanwhile, say that state lawmakers should adopt a more comprehensive approach to addressing the shortfall. And they recommend repealing the income tax cuts of 2003, saying they could go a long way to balance the state’s books.
“There are a lot of economists who are out there saying the worst thing to do during a recession is to raise taxes,” Ruth Hoffman of the Lutheran Advocacy Ministry New Mexico told state lawmakers Wednesday during a legislative hearing about Medicaid, the state’s main low-income health insurance program.
“I want you to know there are a lot of people who disagree with that,” Hoffman continued. “The worst thing you can do is to cut spending. Please don’t tie one hand behind your back by simply dismissing [raising taxes].”
Like much of the state budget, Medicaid is in the red this year. The program faces a $40 million shortfall this year that could grow to $60 million in coming months, Human Services Secretary Pam Hyde told state lawmakers. That’s due in part to a growing number of New Mexicans who are enrolling in the program because of the sour economy.
Her agency has adopted some cost-cutting measures to close this year’s shortfall, including cutting outreach to potentially eligible Medicaid recipients, Hyde said. The thinking behind stopping outreach is that fewer people who enroll would mean a potential slowing of rising costs.
Even more pressing than this year’s shortfall in Medicaid is a potential $300 million shortfall in the program come Jan. 1, 2011, when federal stimulus dollars disappear.
One of the options Hyde has proposed to address that potential 2011 shortfall is to eliminate many, if not all, optional Medicaid services, meaning that thousands of low-income New Mexicans could lose medications, vision and dental services, hospice care and physical therapy.
The implications of such deep cuts are potentially dire for New Mexico, where one in four residents gets health coverage in whole or part through some form of public assistance.
Cutting optional services wasn’t the only cost-saving measure Hyde has proposed to close the potential shortfall. Another measure being considered is the dismantling New Mexico’s State Coverage Insurance (SCI) program.
SCI helps pay premiums for thousands of low-income individuals, and small businesses take advantage of the program to insure employees, officials said.
Another cost-cutting option–and one generally considered to be one of the easiest to accomplish–is to reduce the rate of reimbursement to medical providers, such as physicians and nurse practitioners. Medicaid reimburses medical providers at various rates.
Hyde told state lawmakers that no decisions had been made, but that her agency has to begin planning for the potentially huge shortfall now.