State Fiscal Year 2020 Budget Deal Reached

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On June 29, Governor Whitmer and legislative leaders announced an agreement to resolve the fiscal year (FY) 2019-2020 budget deficit. The deal uses a combination of funding from the state Budget Stabilization Fund, federal Coronavirus Relief Funds (CRF) and cuts to the state budget. No cuts to healthcare were announced in the information provided.

In a joint release, Senate Majority Leader Mike Shirkey (R-Clarklake), House Speaker Lee Chatfield (R-Levering) and the governor spelled out approximately $900 million in spending from the federal funds for schools, hazard pay for teachers, replacement funds for colleges and universities, and new funds for local governments. Together with what was appropriated earlier in the month of June, the state will have allocated $3 billion of its existing CRF. The budget also recognizes the benefit of the enhanced federal Medicaid matching funds, which brings $340 million to the state for the current fiscal year.

The budget agreement also includes $490 million in savings to state government from various state layoffs, furlough days and budget cuts. The MHA does not believe rural hospitals or labor and delivery funding for small and rural hospitals is at risk, and we will continue efforts to ensure the appropriations for hospital Medicaid funding remain in place and continue into FY 2021. For more information about the FY 2020 budget agreement, contact Adam Carlson at the MHA.