COLUMBUS, Ohio -- Gov. John Kasich signed the next state budget into law late Friday night but not before vetoing a proposed freeze on Medicaid expansion enrollment.
Kasich was expected to scrap GOP lawmakers' blow to the health insurance program, which Kasich championed in 2013 and now credits with much of the state's efforts fighting opiate addiction.
"The legislature put $170 million in for opiates -- we don't want to take away the almost $300 million [Medicaid dollars] that would be used in addition," Kasich said shortly after signing the bill.
Kasich used his veto pen late Friday to eliminate 47 line items in the 2018-19 state budget bill. The $133 billion two-year budget -- including $65.5 billion in state general revenue funds -- takes effect Saturday.
But the GOP-controlled House and Senate could return next week to override any of the vetoes. House Speaker Cliff Rosenberger and Senate President Larry Obhof said they planned to review Kasich's vetoes over the weekend.
Kasich also vetoed provisions:
- Charging Medicaid enrollees monthly premiums through the "Healthy Ohio" program and raising taxes on health insurers to generate revenue for counties and regional transit authorities, which require federal approval.
- Eliminating changes to the tangible personal property tax reimbursement that gave more money to some school districts.
- Allowing public universities to raise tuition by 8 percent instead of 6 percent and community colleges to raise tuition $10 per credit hour.
- Allocating $1 million to upgrade voting equipment.
Kasich praised lawmakers for sending him a "structurally balanced" budget after state revenue projections were revised downward $1 billion over the next two years.
"We have some disagreements and we will work through them," Kasich said. "These are things we think are in most cases very critical to make sure we continue to serve Ohioans that are in need."
Obamacare gave states the ability to expand eligibility in Medicaid, the joint state-federal health insurance program for poor and disabled people, to those making less than 138 percent of the federal poverty level.
When Kasich pushed expansion in 2013, his administration estimated 360,000 uninsured Ohioans would become eligible for the program. Since then, more than 725,000 Ohioans have been added to the Medicaid rolls through expansion.
The feds footed the bill for the first few years of the expansion and tapering off to cover 90 percent of the cost by 2020.
Kasich's fellow Republicans in the legislature, many of whom opposed the original expansion, said it's time to rein in costs for the expansion and direct the state's share toward other priorities. They proposed freezing enrollment after July 1, 2018 for new enrollees and previous enrollees who, through a temporary boost in income, lost eligibility.
People receiving treatment for alcohol or drug addiction and mental illness would be allowed to enroll.
The move would result in 500,000 Ohioans losing health insurance in the first 18 months of the freeze, according to memo from Kasich's Office of Health Transformation. The memo also noted that the addiction and mental illness exemptions would likely violate federal law defining the expansion population.
Lawmakers had to trim about $1 billion from the budget Kasich introduced in January. Democrats wanted to eliminate the 2013 small business income tax break for limited liability companies and other pass-through entities, which would generate about $1 billion a year.
"Stealing money from local communities to pay for Columbus' bills will only increase local taxes," Sen. Nick Celebrezze, a Parma Democrat said. "This budget is just more of the same misguided GOP tax policies that have been holding Ohio back."
Medicaid tax replacement fix vetoed
Kasich also vetoed additional funding for counties and transit authorities to patch the loss of revenue from a sales tax on Medicaid managed care organizations. Kasich's budget replaced that revenue for the state through a new fee on the health insurers, obtained through federal permission, and provided some one-time money for the local governments.
Legislators' fix in the budget: Go back to the feds and ask permission to raise the fee to generate about $207 million a year for counties and transit authorities.
Administration officials warned legislators such an increase would likely be rejected because it exceeds the 6 percent cap on such taxes and could threaten the $615 million in state revenue raised through the existing deal.
The County Commissioners Association of Ohio had lobbied for the additional funding.
"In the absence of a revenue replacement mechanism, counties will have to reduce or eliminate funding for programs that invest in economic growth and exacerbate the growing pressure on important systems like criminal justice, public safety, and child protection," Executive Director Suzanne Dulaney said in a statement. "The demand on these services is only growing in the wake of the opiate epidemic."
Mobile readers, click here to read Kasich's veto messages.