2009 AARP Pennsylvania State Issues Preview

By: State: Pennsylvania

Budget

Current revenue projections show that Pennsylvania may be looking at a $2 million deficit in the 2008/09 state budget. Such a deficit could have a severe impact on a number of important state programs, particularly Medicaid assistance for long-term care. The gloomy economic forecast will impact virtually every issue AARP will be concerned about in the 2009 session of the General Assembly.

Health Care Reform

Although health care reform will be debated at the federal level, state health care reform will continue to be a leading issue in Pennsylvania. Excess revenues in a program that provides assistance to physicians in purchasing medical malpractice insurance has been proposed as a short-term funding source for a state health insurance program that would replace the Adult Basic program, which currently provides insurance coverage for some adult Pennsylvanians without access to health care coverage. The new program would insure around 200–300,000 Pennsylvanians who currently do not have health insurance. The scope and long-term funding prospects of such a program have proven to be very controversial, however, and other more modest proposals to improve access to health care will also be considered.

Utilities

The pending expiration of rate caps on electricity for most Pennsylvanians could cause significant increases in electric bills in the next two years. Legislation to extend the rate caps and significantly alter the electric deregulation process in Pennsylvania will be considered by the General Assembly in 2009. Projections currently show that electric rates for customers in Pennsylvania are likely to increase by at least 35% when rate caps expire either at the end of 2009 or 2010. Meanwhile, utility shutoffs have already increased dramatically as energy costs have risen and the procedures for utilities to shut off service have been loosened, leading to fears about many more shutoffs occurring should electricity rate caps expire.

Long-Term Care

Pennsylvania still lags behind most other states in using state funding for home and community based care programs instead of nursing home care. A program funded by lottery revenues, the OPTIONS program, has proven to be an innovative way to provide assistance to older Pennsylvanians to stay at home instead of being forced into institutional care. Unfortunately, funding for OPTIONS has remained mostly stagnant over the past few years while in each of the past three years the state budget has used $250 million of lottery revenues for Medicaid long-term funding, 90% of which goes to nursing homes.

Property Taxes

Proposals to shift education funding away from property taxes will again be debated by the General Assembly in 2009. The debate will continue to center around the fairness of property taxes versus other forms of taxation, although methods to reduce spending by school districts will also be a subject for debate.