In light of the recent stock market shake-up, Gov. Dannel Malloy is slashing nearly $103 million from this year’s state budget.
Citing both stock market volatility and a decrease in the state’s personal income tax revenue, Office of Policy and Management Secretary Ben Barnes said in a letter to comptroller Kevin Lembo last Friday that the year’s revenue estimate had been decreased by $96.1 million. Barnes also identified an additional $15 million cuts in municipal aid, including nearly half a million dollars to New Haven. The Malloy administration has trimmed away $2.4 million from the Department of Education and $8.4 million from the Department of Mental Health and Addiction Services. Most significant, however, are the $64 million in cuts to the Department of Social Services — namely, Medicaid funding to hospitals.
Yale-New Haven Hospital alone will receive $20.4 million less in Medicaid supplemental payments for the year, according to a report released by the nonpartisan Office of Fiscal Analysis. The OFA also notes that, considering federal matching funds, the overall hospital cuts will equate to $192 million for 27 hospitals across the state.
“We are outraged that the governor would slash Medicaid funding that is desperately needed to care for the most vulnerable people in our state,” CEO of the Connecticut Hospital Association Jennifer Jackson said in a statement Friday. “With nearly one in five Connecticut residents on Medicaid, withdrawing even more funding from the state’s obligation is outrageous.”
YNHH has endured a slate of funding cuts recently, including a $67 million decrease in Medicaid reimbursements that closed two Yale-New Haven Health System clinics, as well as a 1.3 percent decrease in revenue as a penalty for neglecting to meet readmission rate standards for the fourth year in a row.
The emergency rescissions have generated outcry from state legislators on both sides of the aisle.
Connecticut House of Representatives Speaker Brendan Sharkey, who represents Hamden, voiced disappointment in how the cuts have targeted some of the areas that the state legislature sought specifically to protect when crafting this year’s budget.
“We also agreed to restore hospital funding the governor proposed to cut, and so these renewed cuts will very likely impact the delivery of healthcare services,” Sharkey said in a statement.
Senate minority leader Len Fasano termed the cuts “a disaster,” calling for a special legislative session regarding the budget in a statement Friday.
Although Republican representative Melissa Ziobron emphasized that she did not endorse the governor’s line cuts, she commended the fact that Malloy now recognizes that his previous budget is flawed.
“We should be cutting raises, salary accounts, overtime and unnecessary projects,” Ziobron said on her Facebook page Saturday.
Other New Haven agencies affected by the budget cuts include the New Haven Jobs Funnel, the city’s fire training school, the New Haven Festival of Arts and Ideas and the city arts council.
Malloy’s budget for fiscal years 2016 and 2017 sparked intense legislative debate beginning this February, as his administration proposed spending cuts over tax hikes. The budget was further complicated as Lembo discovered a miscalculation in the budget, forcing lawmakers to cut an additional $60 million.
The state’s previous budget reduction occurred last April, when the governor’s administration called for almost $14 million in emergency rescissions to executive branch agencies.
Correction: Sep. 22
A previous version of this article incorrectly stated that Connecticut House of Representatives Speaker Brendan Sharkey represents Hartford. In fact, Sharkey represents Hamden, not Hartford.