OLYMPIA, WA – This year’s revenue forecasts, rising costs, and expanding needs have required reductions to propose a balanced budget in Washington State. As a result of the recent Office of Financial Management directive, the Health Care Authority is pausing implementation of coverage for adult chiropractic and acupuncture services planned for January 1st.
The agency is pausing or retracting any changes related to those services effective immediately. They include:
- Managed care contracts
- Rate adjustments
- State Plan Amendment (SPA)
- Washington Administrative Code (WAC)
- Billing guides, fee schedules, and any other provider notifications
The Governor’s operating budget will prioritize continuing essential programs and addressing caseload increases while not expanding existing programs and services.
“The magnitude of the operating budget deficit is between $10 and $12 billion over the four-year outlook period. This deficit is due to the recent revenue forecasts that were adjusted down and the increase in caseloads and the cost to maintain existing programs. The budget is a work in progress, and we need your assistance to propose a budget that best reflects the needs of our state,” according to OFM Director Pat Sullivan.
Transportation budget revenue projections also have trended down for several forecasts. That, along with rising costs and increasing demands, has created a situation where revenues are not covering current commitments.
“To assist with this effort, I direct agencies to propose operating and transportation budget reductions, starting with pauses or delays of programs, and to identify savings options for both the 2025 supplemental budgets and 2025-27 budgets. Please consider measures that will result in immediate savings, such as hiring and other freezes,” Sullivan says. “Your OFM budget advisor has already contacted your staff about these reduction proposals. Please work with your advisor to propose options by November 15, 2024. Thanks to those of you who have already provided options.”
Sullivan asks each agency to propose the following operating or transportation budget reduction options:
• Under-expenditures, premium adjustments, and efficiencies
• Mainly Near General Fund accounts (General Fund-State, Education Legacy Trust, Opportunity Pathways, and Workforce Education Investment), but consider all accounts for savings
• Use of other funds instead of General Fund-State whenever possible
• Program eliminations, reductions, and delays, especially for those programs or services that do not meet the agency’s core mission.
Sullivan also asks that leaders also consider the following:
• Central services charge programs (would the action impact central service costs?)
• Offsets to savings (does the reduction in one program move the problem and cost to another program?)
• Overlapping programs (does the reduction cross programs and/or agencies?)
• Timing of savings (how long would it take to implement the reductions?)
Although this budget savings options exercise applies to cabinet agencies, Sullivan urges the presidents of higher education institutions, boards and commissions, and our separately elected officials to undertake a similar budget savings exercise for their agencies and institutions.
