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Social studies
To handle the looming $2 billion budget deficit, state budgeters will have to cut, cut, cut — and health and humans services are likely to do the most bleeding

MAKE NO MISTAKE. The coming year heralds the most dire forecast yet for critical, lifesaving health and human services funded by the government in the 24 months since the state’s protracted budget crisis first surfaced, in 2001.

In looking toward the year ahead, pundits, politicians, and prognosticators continue to marvel at the state’s ever-intensifying financial woes. And preliminary projections for fiscal year (FY) 2004 paint a very gloomy picture indeed. Just last November, the Massachusetts Budget and Policy Center (MBPC), a progressive think tank in Boston, released a report pegging the FY 2004 budget gap at $1.4 billion — despite the $1 billion in new spending cuts and the $1 billion in new taxes implemented this fiscal year. That figure assumes a healthy economy. But if the job market falters again — as the latest signs indicate it may, what with state revenues taking an unexpected $100 million dive last week — the MBPC predicts that the FY ’04 gap could exceed $2.2 billion. Likewise, the Boston-based Massachusetts Taxpayers Association, a more conservative group, expects the deficit to top $2 billion. (Some government insiders say the shortfall could be as much as $3 billion.) Even Governor-elect Mitt Romney — who avoided discussing the state’s financial problems during the gubernatorial campaign — has gotten honest about the grim realities. In recent weeks, he and his top aides have likened the current fiscal crisis to the worst the state has seen since the Great Depression.

Despite concerns about balancing the state’s $23 billion budget, however, Romney appears to be sticking to his campaign pledge not to raise new tax revenues — while still protecting vital state services. House Speaker Tom Finneran — who, despite a challenge to his reign on January 1, will probably continue to dominate the Massachusetts House of Representatives — has also declared that taxes will stay "off the table" during the FY ’04 budget debate. This insistence on no new taxes seems particularly shortsighted in light of the fact that state budget-makers have no cash reserves on which to fall back. In the past two fiscal years, legislators have drawn as much as $2.7 billion from the "rainy day" fund to balance the budget and limit harsh cuts. But they have drained their own piggy bank, and today, the fund has only $340 million left.

Which is to say that the only way for state budget-makers to handle the looming $2 billion budget deficit will be to cut, cut, cut. "The bottom line is that we ain’t seen nothing yet," warns State Representative Ruth Balser (D-Newton). If history is any guide, health and human services run the highest risk of ending up on the chopping block. And some advocates predict that the upcoming year will bring the most severe, most consequential spending reductions in such services yet. "We’ve done the easy cuts," notes Sarah Nolan, the MBPC’s policy analyst. To date, for instance, budgeters have wiped away $98 million in health-care services — from HIV/AIDS prevention to substance-abuse treatment to smoking-cessation programs. Eliminating these things may deal a heavy blow to public health in Massachusetts, but their termination doesn’t inflict the pain that reductions in food stamps and shelters do. But such safety-net programs, as Nolan explains, "are the [only] kinds of human services that are left today. So next year, we’re looking at ever-more-painful, more brutal cuts."

THERE’S NO question that a steady barrage of budget cuts in health and human services has already left many of the state’s most vulnerable residents reeling. In the past two fiscal years, human-services agencies have endured four rounds of spending cuts totaling $1.8 billion. That, of course, has translated into longer waiting lists and fewer services at the 15 state departments that care for the mentally ill, the mentally retarded, the disabled, the elderly, children, and the poor.

At the state’s two largest agencies, the Department of Mental Retardation (DMR) and the Department of Mental Health (DMH), officials have grappled with tens of millions of dollars in funding losses — $24 million and $26 million, respectively — leaving them with budgets too small to maintain existing services from fiscal 2001 to fiscal 2003. The DMR has managed to uphold much of the legal agreement mandating that $25 million be set aside to provide housing and other support services for mentally retarded adults who have languished on lengthy waiting lists for years (see "The Waiting Game," News and Features, September 22, 2000), although Governor Jane Swift vetoed $3 million of that figure this fiscal year. At the DMH, though, tens of thousands of mentally ill adults and children remain relegated to ever-longer waiting lists for housing and basic services. Still, because DMR and DMH boasted relatively big budgets to begin with — $1 billion and $650 million — officials have spared most programs that allow the mentally retarded and mentally ill to lead normal, productive lives.

The same cannot be said, however, for the state’s smaller agencies. The Massachusetts Commission for the Blind and the Massachusetts Commission for the Deaf and Hard of Hearing — whose combined budgets equal roughly $500 million — have experienced such a precipitous drop in funding that they’ve had to deny essentially destitute blind, deaf, and disabled residents even the bare minimum of services. Today, 300 poor, blind senior citizens statewide cannot get access to low-vision aides such as magnification lenses. Another 280 deaf and blind seniors, who qualify for government-funded health benefits, have yet to receive the white canes and hearing aids that they need each day to function.

And this deprivation extends far beyond the disabled. In the current fiscal year, for example, legal immigrants in Massachusetts have felt the brunt of the budgetary ax. In July 2002, when FY ’03 began, legislators gutted the safety net for legal immigrants by eliminating programs that give them food stamps and cash assistance. Even initiatives that don’t cost much money at all — such as the $500,000 citizenship-assistance program, which has helped 22,000 poor immigrants become American citizens since 1998 — have been targeted. Reshma Shamasunder, the director of benefits policy at the Massachusetts Immigrant and Refugee Advocacy Coalition, explains that the FY ’03 reductions — which saved the state roughly $10 million total — have left legal immigrants feeling under siege. "It was a very tough year for immigrants," she says. "Everyone has felt so debilitated in the face of these cuts."

So have many among the homeless population. Fiscal 2003 brought with it slashes in funding of up to 15 percent — or $10 million total — for emergency shelters for both individuals and families. Robin Frost, the director of the Massachusetts Coalition for the Homeless, says that shelters have responded by getting rid of support services that help homeless people get back on their feet — including counseling, job training, and housing searches. This fiscal year, legislators also eliminated the $9 million emergency-rent-assistance program, which offered 800 or so low-income families up to $3000 to pay their rent and thus avoid losing their homes. At the same time, lawmakers tightened up the shelter-eligibility requirements so that a family of four must earn no more than $18,100 per year to get a shelter roof over its head — as compared to $23,530 per year in FY ’02. All this comes at a time when the state has seen soaring homelessness. Right now, shelters in Massachusetts are serving at least twice as many people as there are actual beds. As Frost puts it, "These are drastic cuts at a time when unprecedented numbers of people are becoming homeless."

By far, however, Medicaid — one of the juiciest targets in the budget — has suffered the hardest hits over the past 12 months. Medicaid (also known as MassHealth), the joint state-federal health-care program for the poor and disabled, has had to implement all kinds of restrictions and coverage reductions. Last February, as part of $200 million in emergency cuts during FY ’02, Swift got rid of basic-dental-hygiene coverage for hundreds of adults across the state. Then, in December, as part of $60 million in emergency cuts during FY ’03, she slashed all benefits that were not federally mandated. That means that essential devices such as eyeglasses, orthopedic shoes, and even prosthetic limbs are no longer available for Medicaid recipients. The biggest blow will fall April 1, when as many as 50,000 residents — the majority of them mentally ill, homeless, disabled, and chronically unemployed — are slated to be taken off the rolls. For those who are familiar with the state’s patchwork of human services, eliminating the "MassHealth Basic Program," as it’s known — a move that will save only $50 million from the $6 billion Medicaid budget — has come to epitomize the havoc wreaked upon social services in the wake of the fiscal crisis. As State Representative Ellen Story (D-Amherst), an outspoken advocate for human services, says, "Kicking people off Medicaid was a real low point. The state has turned its back on its most needy residents."

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Issue Date: January 2 - 9, 2003
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