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More health, welfare cuts?

Hospitals, others criticize governor's proposal to chop $40 million

By Patrick Howe

Associated Press

ST. PAUL -- For the second straight year, Gov. Tim Pawlenty is looking to health and welfare programs for the cash to fill the largest holes in his budget. But hospital officials and advocates for the poor told senators Wednesday that his latest proposal would weaken their programs to the breaking point.

"If a space alien were to come down to earth to find out how to kill off faith-based social service organizations -- this is how to do it: Each year, reduce funding to make it ever more impossible to retain dedicated employees to provide services for people in need," said Mark Peterson, president of Lutheran Social Services of Minnesota.

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He said his group already has cut a foster grandparents program, closed an emergency shelter for children in the Brainerd area and suspended an emergency shelter in St. Paul.

A recent budget forecast puts the state $160 million in the hole for the two-year budget that ends in 2005.

To fill the gap, Pawlenty proposes to find $40 million from Department of Human Services programs, mostly by cutting payments to hospitals, nursing homes and pharmacies.

Another $70 million would come from a fund that pays for the MinnesotaCare program, which subsidizes health insurance for low-income working people. The money ultimately comes from a 2 percent tax on health-care services.

"Why should health care account for 70 percent of the budget solution?" Mary Klimp, chief executive of New Prague's Queen of Peace Hospital, asked members of the Senate Health, Human Services and Corrections Committee.

Speaking for the Minnesota Hospital Association, she said one in four hospitals in the state is spending more than it earns, already putting those hospitals at risk of closure.

Others spoke against a part of the plan that would cut the amount of time welfare recipients would spend in college or other training programs from two years to one. They'd still have to work at least 20 hours per week, a new requirement Pawlenty sought last year.

"We know that education is the way that we can help a lot of people really achieve the goal of transitioning from welfare to work," said Karen Kingsley of the Affirmative Options Coalition.

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About 5 percent of welfare recipients are in training programs, but Kingsley said few of the programs can be completed in 12 months, particularly if someone is required to work 20 hours per week.

The proposed cuts pale in comparison to those enacted last year, when Pawlenty and House Republicans prevailed with a plan to cut nearly $1 billion out of health and human services spending.

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