Presentation of Idaho reports on Idaho Public Television is made possible through the generous support of the Laura Moore Cunningham Foundation, committed to fulfilling the Moore and Bettis family legacy of building the great state of Idaho.

With additional major funding provided by the estate of Darrell Arthur Kammer in support of independent media that strengthens a democratic and just society.

And by the Hansberger Family Foundation.

By the Friends of Idaho Public Television.

The Corporation for Public Broadcasting.

And donations to the station from viewers like you.

Thank you.

think about what's not measured on a spreadsheet, right?

These people's lives are directly impacted, and their glide path is completely different than it would have been.

Looming budget cuts have already defined this legislative session, and stakeholders are weighing in on how saving a dollar today could cost state and local governments much more in the future.

I'm Melissa Davlin.

Idaho Reports starts now.

Hello and welcome to Idaho reports this week Ivy Walker with Idaho Voices for Children, Senator Julie VanOrden, Senator Jim Woodward and Nampa mother Trixy Wade join me to discuss proposals to cut Medicaid costs and how those might affect Idaho families.

But first, the Idaho Supreme Court heard oral arguments last Friday in a challenge to the Parental Choice Tax Credit, a program lawmakers established last year that would allow parents to write off up to $5,000 in private education expenses on their state taxes.

The challenge to the law hinges on the Idaho constitutional mandate that the state legislature maintain uniform and thorough public schools.

If they intended to say the state could only appropriate money to public schools, why wouldn't they use one one system of public schools as opposed to a or the you know, some other states have a provision in their Constitution that is specific.

You can only appropriate public moneys to public schools.

We don't have any of that.

When I look at the constitutional provision, it talks about maintaining a system of education.

I'm just wondering what constitutes maintaining and if setting standards that they have to meet in order to qualify for the tax credit, if that is the equivalent of maintaining.

The Treasure Valley Math and Science Center in here in, in the Boise School District.

Not every child gets to go there.

You know, if you're a kid that's going to be studying and studying differential equations, you get to go there.

But but not everybody gets to go.

I mean, so so this idea that there's different methodologies, I mean, we see that within the public school system.

Not all schools are the same.

That that's true.

Not all schools are the same.

But when that criteria is met, those public schools take those students.

In this case, you could have a family who meets the criteria for the tax credit, but it's ultimately up to the private school whether or not they will accept or admit that student.

At the end of the line of this bill, you have a private gatekeeper who's saying, even if you meet the criteria for the credit, they can still say that we will not admit you to the school.

After the hearing, producer Logan Finney spoke with Daniel Mooney, president of the Committee to Protect and Preserve the Idaho Constitution, the petitioners in the lawsuit.

He also spoke with Chris Cargill, president of the Mountain State's Policy Center, which supports the tax credit program.

When we set up a system, we're talking about a single system.

And and we're not talking about a floor or a ceiling where, when, when the legislature creates this parallel track for this hodgepodge of different organizations to decide how, that system should be run, that and we devote public funds to it that pollutes that system.

Right.

when it says in the state constitution about a uniform, thorough public school system, what exactly does ‘a’ mean?

Does it mean just one?

Does it mean, a a floor, does it mean a ceiling?

What exactly is the argument here?

And so based on the questions that the justices asked, I think it's going to be really hard for the petitioners to prevail.

But you never want to try to predict these things because you don't know exactly what's going to happen when the justices go back to their chambers and start talking with each other and reading more into the law.

Meanwhile, the State Tax Commission continues to accept applications for that program.

On our website, you can find Logan's extended conversation with Chris Cargill, including some of the Mountain State Policy Center's policy recommendations for Idaho in 2026.

That's at idahoreports.org.

You can also find it at youtube.com/IdahoReports or wherever you listen to podcasts.

At the Statehouse on Thursday morning, the House Revenue and Taxation Committee introduced a new version of the Tax Conformity Bill, which would align Idaho's tax code with federal changes and the One Big Beautiful Bill.

Lawmakers are still negotiating the finer details, but the governor and State Tax Commission estimate that fully conforming with the federal changes would mean another $155 million hit in state revenue each fiscal year.

Also this week, the co-chairs of the Joint Finance Appropriations Committee sent a letter to heads of state agencies telling them that lawmakers are considering further reducing budgets for fiscal years 26 and 27, including either additional 1% or 2% cuts.

The co-chairs also asked the agency leaders to outline how budget reductions will affect their workforces, and which programs and essential services would be affected.

That's on top of the 3% reductions that Governor Brad Little implemented mid fiscal year, and that agencies have built into their budget requests.

And for the sake of transparency, Idaho Public Television is a state agency with multiple funding sources, including private donations and the state general fund.

On Wednesday, the Joint Finance Appropriations Committee heard the court's budget request, including how potential cuts might affect the judiciary and potentially other state agencies.

Logan Finney joins me now with more.

Thanks, Melissa.

Last week, Supreme Court Chief Justice Richard Bevan told lawmakers that Idaho's drug and mental health treatment courts are at risk due to the Department of Health and Welfare cutting funding for peer support services.

Administrative Director of the Courts Sara Omundson appeared before the budget committee on Wednesday, where she explained treatment courts serve as a cheaper alternative to incarceration.

The peer support specialists.

The reason why they are a critical component of that program is those are the folks that help them stabilize.

Those are the folks that go to their house and make sure they took their meds that day.

Those are the folks that take them down to Social Security, walk them down there and make sure that they have applied for things in the initial stages of a treatment court, in the initial stages of the mental health court.

What they are trying to do is stabilize a person who is so destabilized and so mentally ill and this is these are people who have serious, persistent mental illness.

They are so destabilized that they have committed crimes.

And in the absence of that, the judge's alternative is to put them in prison.

The court system has tapped existing funds to sustain local treatment courts through the end of this current fiscal year, but has no guarantees the program could survive continued budget reductions, seeing as the treatment courts are not constitutionally mandated like other court services.

Also this week, I stopped by the Idaho Association of Counties midwinter conference on Wednesday, where Bonneville County Sheriff Sam Hulse and Association Director Seth Grigg explained to me how these kinds of behavioral health programs intersect with the local criminal justice system.

when we talk about behavioral health services in the state of Idaho, we have several programs that have been developed over time that help folks that are living with, mental illnesses and or substance abuse, in the community and having those programs in place, quite often help people live more fulfilled lives and keep them out of crisis.

And, so we interact with those programs directly as law enforcement.

And we understand when those programs are in place, that that diverts a lot of people away from the justice system we have seen successes around the state over the last few years in really making sure that those individuals that are dealing with severe mental illnesses and substance abuse, disorders, that those individuals are getting the treatment that they need.

And through that treatment, we've been able to to keep them out of jails.

And so if funding for those programs goes away, we're going to see more emergency responses from our sheriff's offices, more emergency responses from our EMS departments.

And, at the end of the day, we're going to see increased expenses within our jails if there's no treatment, unfortunately, that's oftentimes where individuals end up.

And within the county jail, we don't have the resources to really tackle, mental health or substance abuse.

even though you might save a little bit of money, the overall detriment to the system is much, much higher.

And so you have to watch what you're cutting because not all things are equal.

And you have to figure out what is really doing, the heavy lifting, what makes a difference locally.

And don't just cut indiscriminately.

You know, it's simple to say we're just going to take 3%, but you can't treat all programs the same.

And you have to look at what's doing the heavy lifting and and be mindful, really mindful of what that does at the local community level.

And then the thing that I like to say often is think about what's not measured on a spreadsheet, right?

These people's lives are directly impacted, and their glide path is completely different than it would have been.

And potentially they end up back.

Yeah.

In the jail or incarcerated.

Nobody wants that.

Thanks, Logan.

One of the state's biggest annual expenses is Medicaid, which means that when lawmakers are looking to cut spending, Medicaid programs are among the first to come up.

But some of this year's proposed cuts could have big impacts on Idaho families.

Joining me to discuss is Ivy Walker, policy associate for Idaho Voices for Children.

Trixie Wade, A Nampa mother whose children use Medicaid services.

Senator Julie VanOrden, who chairs the Senate Health and Welfare Committee.

And Senator Jim Woodward, who sits on the Joint Finance Appropriations Committee.

First, I want to make it clear that the cuts we're discussing are suggestions, possible ways to reduce Medicaid spending, as suggested by the governor's office and as an alternative to repealing Medicaid expansion.

But the conversations are causing a lot of anxiety for families who rely on some of those services.

Trixy, I want to start with you.

How?

First of all, tell us about your family.

Well, right now I have a ten year old daughter that's medically complex.

She has PVL with microcephaly, which led to cerebral palsy, dystonia, caudillo vision impairment.

And she has significant developmental delays, and she's non-verbal.

With this diagnosis, you know, we have lots of medical care that we need.

We do therapies that help her even just to swallow, to remember, to swallow and aspirate and leading up to more hospital visits.

My older daughter also relies on some of the programs through Medicaid.

She's a single mom of three, and child support doesn't come in.

She needs they need food.

And she also uses them for daycare because she works a full time job.

And, in our household, it's my husband, myself, and my ten year old daughter, and my older daughter lives on her own.

So when, especially when we're talking about your ten year old who lives with you, how might the proposed cuts impact her care?

Well, right now we use services like personal care support, private duty nursing.

The therapies we have PT, OT.

We haven't been able to find a new speech therapist or feeding therapist, but, and we have to use skilled providers that understand the complex care.

And a lot of our, medical stuff is out of state, because in Idaho, you don't have the complex care teams like they have at some of the children's hospitals.

and and for your adult daughter and your grandchildren.

How might cuts affect them?

It'll be difficult for my daughter to be able to have all three in daycare.

So she may have to switch how she, when she works, what she does for a living.

As far as I mean, that's the biggest one I know that's going to impact her is not having the help with the daycare providing.

Ivy, Idaho Voices for Children put out an explainer this week on how these new proposals might affect children and families.

Can you give us some of the highlights?

Sure.

I think first and foremost, when we're talking about kids on Medicaid, when kids don't get that care early on, there are long term consequences for all of us.

So in 2024, 9% of babies were born preterm and 7% were born low birth weight.

These are conditions that can lead to lifelong health complications, and lengthy NICU stays for families, costing them thousands of dollars and lots more.

12% of Idaho's infants and toddlers we're talking about under six years old didn't get a single medical visit between 2023 and 2024.

And this isn't because parents don't care.

They either can't access it or it's priced out of their reach.

And 64% of toddlers never even got a developmental screening in the last year.

And when we miss those windows, kids struggle more in school.

Parents are having to take time off work.

And costs go up for the school districts, for our health care system and ultimately taxpayers.

Supporting early care isn't a partisan idea.

It's a fiscally responsible one.

And every economist will tell you the earlier you invest in children, the more you'll save down the road.

So, Senator VanOrden, I want to bring you into the conversation.

As we mentioned, these are just suggested cuts from your perspective.

What are some of the options on the table when looking at further reducing the Medicaid budget?

So the decisions are hard to make, I will tell you that right now.

Because as I look through all of these, you almost as as I go out and visit with people in my community could plug somebody into each one of these.

And, I want to reiterate that these are reductions, these are not ending of program.

These these ones that they've done right now, and that they're looking at their reductions.

Some of them might be removal like right here, removal of non expansion adult pharmacy.

Like that's one of the suggestions on the list.

And here's another removal.

This one this one is a very difficult one because we have found out from CMS we do that that we have to remove Medicaid expansion.

So that's not really a good option for us right there.

Removal of adult dental.

They did that before.

Way back in I think it was 2009 or so, but they ended up bringing it back.

And so they did have data that showed what happened in that interim.

That's what you find on a lot of these is when, analysts come forward or people from the Department of Health and Welfare come and tell legislators, if you remove this, this is what the the consequences will be down the road.

And but we don't have data to put out there and show them.

And so it's very hard to convince some legislators that there will be consequences for this.

And you're referring to the list of proposed cuts to Medicaid from the Department of Health and Welfare and the governor's office.

Do you get the impression that this is a foregone conclusion, or is there still room for conversation with the department and the and the House Health and Welfare Committee?

I think there's still room for conversation.

I know there are a number of legislators that have been going and having conversations with the governor's office, meeting up with them and saying, what about if we do this, you know, or let's look at this, maybe we maybe have some funds over here.

Let's look at this program.

What will the fallout be?

So I think everybody's looking for what's going to be have the least amount of consequences that come after it.

And also, I think what they're also looking at, just what I said is reduction, not elimination, but a reduction.

One of the biggest proposed cuts it might be the biggest proposed cut is $176 million of general funds that would go to home and community based services, which helps individuals with disabilities receive care in their homes as opposed to being institutionalized.

If you cut that much money from home and community based services.

Is that going to result in some Idahoans who could otherwise live in their homes, ending up in state hospitals or elsewhere?

It could.

It could.

And then you have the expenses of them being in that institution, which is quite a bit more than what you were paying before.

I think that's that one item has I know people have brought it up, but it seems to dissipate from the conversation very quickly.

So in other words, you don't see that as one of the more likely proposals that will actually pass.

Correct.

Another question on, some of these proposed cuts.

The state recently transitioned to managed care for Medicaid recipients, and one of the proposed cuts from the governor's office is a $34 million reduction in administrative costs for those managed care contracts.

Would the state, even be able to continue with managed care with such a cut to those contracts.

With those entities, those are like behavioral health with Magellan.

They have a contract.

So that's what they're looking at.

Administrative costs in those, as you know, from last year.

House Bill 345 put in place, comprehensive managed care for all of Medicaid.

So we're still moving down that road.

We're still anticipating that that could happen.

When that happens, all of those services get rolled into those managed care organizations.

That's what we're aiming for.

So they still would be in existence, but what they look like?

Melissa, I can't tell you right now because we're still working on that.

Senator Woodward, I haven't forgotten about you.

You sit on the Joint Finance Budgeting Committee.

Can you give us some insight into these budget conversations about Medicaid?

I will, I'll say one point on to finish up there on the managed care that we voted on last year.

I do hear quite a bit of buyer's remorse and that, that's a decision that has to be implemented over many years.

I think it's not until 2029 that we would see full implementation.

And so, I'm not sure I'm not convinced yet that we're still going to head that route.

And we'll see that, for future debate.

With the talking about the budget and why we're having this conversation about these cuts.

I think it's important to understand how we got here.

And that really comes from a decisions we've made primarily last year.

But we've we've cut the income tax rate in the state of Idaho five times over 8 or 9 years.

So we've come down from 7.4% to now 5.3%.

Excuse me.

Yeah.

And I would say that that that last .395% of the income tax rate that we took off last year, maybe we got out ahead of ourselves a little bit.

We started out with a very high budget, a revenue projection last year and, and then, and then made commitments up to that.

And then we found out that maybe the revenue wasn't quite that high.

And so now we're in this position, and maybe, perhaps that was intentional by some folks to create this, this situation where we have to make these cuts, but we play the hand dealt.

And so here we are, and we have to balance the budget in accordance with our Constitution.

The big questions now coming up in regard to balancing that are, we start with the governor's proposal and one of the assumptions made in both the and the governor's proposal, and that people may or may not agree with is whether or not we conform with the tax code.

In the One Big Beautiful Bill that's really key to this right now, the One Big Beautiful Bill, has those pieces for individuals.

No tax on overtime wages, no tax on tips, but it also has, some corporate code that would change.

And so if we implement the provisions of the One Big Beautiful Bill now then the question is, if we want to implement those which we normally align with federal tax code to make our Idaho tax structure, operate smoother, then when do we implement?

And so is that fiscal year or tax year 2025 or tax year 2026?

And we are in the tax season right now for tax year 2025.

My gut feel says that we we shouldn't be in the middle of tax season changing all the rules.

And that's for the the CPAs out there, the companies that provide the software.

It's going to make a little bit of a mess, I think, if we try to make that change.

And the other side of it is we've given so much in tax cuts and the argument to, to, to conform for tax year 25 is that the people of Idaho need that tax break.

But we have made those five cuts in the last eight years.

And and so we've given a lot of tax relief.

And actually what I hear at home from folks is, you know, that's fine that you gave me a little income tax cut, but I'd really rather have you work on property taxes.

And so that all drives me to toward the idea of, moving along with the governor's recommendation, conforming for tax year 2026.

But, we were in an easier situation if we don't conform for 2025.

You say your gut feeling is that this isn't the time to fully do this for the tax season we're currently in.

It seems like the House has a different idea.

And as you alluded to, tax proposals start on the House side.

You said earlier that you you play the hand you're dealt, but the Senate has passed all of these tax cuts that you're saying has put you in this situation as, as the Budget Committee.

Do you regret any of those tax cuts?

Well, I'm one of two Republicans who voted no on the tax cut last year.

And those five tax cuts, I've been here for three of those.

I voted yes on a few of those, but I thought we were getting it going too far last year.

And so I guess I can say I don't regret that because I, you know, I think I feel like I was in the right on that.

Yeah.

And you're certainly correct that those have all made it through.

I think the situation is different now when you start to talk about, the reality of, of making these cuts both in Medicaid and some other hard decisions, we, the, the budget assumes we're going to take $275 million out of transportation funds for the transportation department and local entities.

That has a real effect on the road you drive on.

We we don't have the ability right now to add any pay to the Idaho State Patrol or add any funds for trooper pay.

And we are struggling to keep troopers on the road right now.

So Medicaid, along with these other questions, those are really the basic levels of service.

If you talk about physical safety, provided by our Idaho State Police and then transportation, if we can't meet those requirements, what are we doing?

I do want to ask, understanding that it is not likely that the House is going to agree to pause any tax cuts that have already been passed or implemented.

You know, realistically, Senator VanOrden, if we're talking about cutting some of these home based services for including children or repealing Medicaid expansion, is repealing Medicaid expansion on the table?

It depends on who you talk to.

I think there's a lot that a lot of legislators that would like to see that happen, only because they felt like the price tag for it when it was implemented was a lot different than the price tag we have now.

And, so yes, I think it's still on the table.

According to the governor, it's not.

He I heard him in a press conference and he was an absolute no on it, but I have had, some providers that want to have some programs back, that say, can we just do away with Medicaid expansion and take care of the kids?

Ivy, we have about 90 seconds left, but I want to give you a chance to respond.

I just would just say that our Medicaid system is already at its bare bones.

We're talking about the lowest income criteria for pregnant women and children in the nation.

A pregnant woman to qualify for Medicaid in Idaho has to earn less than $22,000 a year.

That's barely enough to afford her bills, let alone be able to sign up for a private health insurance plan when premiums have just skyrocketed.

43% of Idaho's children, er, Idaho's child uninsured rate skyrocketed 43% in the last two years, and 1 in 8 women in Idaho of childbearing age are also uninsured.

This is not the time to be kneecapping our health care system.

Trixy, very briefly, you're working on a proposal that would bring back the family personal care services, the ability for family members to get paid for taking care of children and immediate family members with disabilities.

That was done away with by the Department of Health and Welfare last year because of concerns about fraud.

Does your proposal address those concerns?

We've met with legislators and the department, and we've put in the safeguards that they have suggested.

So we believe we’ve hit everything.

And I know yesterday, our sponsor had met with Health and Welfare, and they went down and they made some more changes.

I haven't heard what those are yet, but, we were addressing their concerns.

All right.

Certainly a fluid situation, as we've heard with Medicaid.

Thank you for so much for joining us this week.

And thank you so much for watching.

Remember to subscribe to our newsletter.

You'll find that link at idahoreports.org.

And we'll see you right back here next Thursday.

Presentation of Idaho reports on Idaho Public Television is made possible through the generous support of the Laura Moore Cunningham Foundation, committed to fulfilling the Moore and Bettis family legacy of building the great state of Idaho.

With additional major funding provided by the estate of Darrell Arthur Kammer in support of independent media that strengthens a democratic and just society.

And by the Hansberger Family Foundation.

By the Friends of Idaho Public Television.

The Corporation for Public Broadcasting.

And donations to the station from viewers like you.

Thank you.