New Hampshire’s legislature officially convened the 2018 session in January to consider hundreds of bills. However, much of the debate will center on a handful of policy decisions and funding challenges.
Medicaid Expansion
The continuation of the NH Health Protection Program (NHHPP), the state’s Medicaid expansion that is set to expire at the end of 2018, affects tens of thousands of Granite Staters, including the most vulnerable citizens. More than 50,000 residents rely on the NHHPP for access to care, and the program has played a key role in the state’s ability to respond to the ongoing opioid crisis.
The NHHPP also makes health coverage accessible to thousands of low-income workers who are not insured through their employers and those who don’t earn enough to afford coverage. Since its inception in 2014, the NHHPP has provided coverage for more than 120,000 low-income residents, demonstrating its value as a temporary workforce support for many who cycle off the program as their economic circumstances improve.
There is bipartisan support for reauthorizing the NHHPP among legislative leaders and Gov. Chris Sununu. In addition to ensuring the NHHPP’s continuation, the legislature must identify the resources to provide a new sustainable funding mechanism starting in January 2019.
The estimated state contribution required to match the federal contribution for 2018 is approximately $23 million, but the federal match declines in future years and additional state funding will be required. The federal government has indicated that the program’s current funding structure will only be permitted through the end of 2018. The legislature will also need to resolve whether certain NHHPP participants move to managed care or remain on the individual marketplace.
Opioid Crisis
Results from an October 2017 Granite State Poll found 71 percent of respondents see the opioid crisis as the most critical issue facing the state. Funding decisions at the federal and state levels will have a profound effect on NH’s ability to confront the epidemic.
The NHHPP has significantly increased access to substance use disorder treatment services and plays a vital role in helping individuals rebuild their lives. Policymakers must find ways to address the ripple effects caused by this opioid epidemic and ensure sufficient funding is in place to support the needs of children, families and communities impacted by this public health crisis.
Full-Day Kindergarten
Last session, the legislature passed a bill providing additional funding to municipalities that opt to offer full-day kindergarten. The state is committed to funding an additional $1,100 per pupil, with revenue from newly legalized Keno gaming designated as the primary funding source for the program. However, there were few surplus dollars available in the state budget to fill the gap should Keno receipts be inadequate to meet the state funding commitment.
The legislature will need to address how the state might respond to a shortfall in Keno revenue for kindergarten. A number of variables make this a challenging task. First, it is difficult to project what Keno receipts will be or how receipts will fluctuate from year to year. One fiscal note estimated Keno revenue would be $8.5 million per year, but other estimates vary widely. Second, the decision to implement full-day kindergarten remains with each municipality, and the overall program cost is a factor of the yet unknown number of communities and students participating.
Finally, the choice of whether to allow Keno within a community is a local decision; municipalities could reject Keno within their jurisdictions but still accept Keno revenue generated by other municipalities to fund their full-day kindergarten programs. Regardless of how much revenue is ultimately raised by Keno, the legislature has committed to providing funding for full-day kindergarten and will have to address any funding shortfall related to these uncertainties.
State Revenue & Federal Transfers
Potentially the greatest fiscal challenge facing the coming legislature will be responding to changes in federal funding and transfer mechanisms to the states. About 30 percent of expenditures in the state budget are funded through federal grants and programs, which support a range of public services related to education, environment, health, safety, transportation and other areas.
While federal priorities and funding transfers to the states are still being determined, it is likely that there will be significant changes to the type and amount of funding available to states. Coupled with state revenue growth that has slowed compared to recent years, the next legislative session may require responses to a new fiscal reality for NH.
John Shea is executive director of the NH Fiscal Policy Institute, an independent nonprofit, nonpartisan public policy research organization based in Concord. Learn more at nhfpi.org.
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