Gov. Beshear’s Budget Makes Bold Investments in Kentuckians’ Health Care and Supports Most Vulnerable

Editor’s note: To view the health and support services executive budget summary, click here.

Proposed budget fully funds Medicaid and addresses Kentucky’s critical nursing shortage

FRANKFORT, Ky. (Jan. 12, 2022) – Today, Gov. Andy Beshear outlined his budget plan to make critical investments to expand health care access and support services for Kentuckians, including fully funding the Medicaid program, on which one in three Kentuckians rely.  

“World-class companies are looking to Kentucky to invest, and one of their priorities is a strong and healthy workforce,” said Gov. Beshear. “Health care is a basic human right. It’s also a key component to a growing economy. This budget promotes our Kentucky value of caring for our neighbor, while also working to capitalize on our unprecedented economic momentum.” 

The Governor said the state’s recent record-breaking economic growth, with $11.2 billion in new investments and 18,000 new full-time jobs added in 2021 alone, proves Kentucky is a destination for leading global companies like Ford Motor Co., Toyota Motor Corp., GE Appliances and Amazon. His budget positions Kentucky to remain an economic leader while also expanding health care access and support services to Kentuckians across the commonwealth.

Today’s budget announcements follow the Governor’s relaunch of kynect, Kentucky’s state-based health insurance marketplace, which makes common medical visits less costly.

Fully Funding Medicaid
The Governor’s budget fully funds the Medicaid program, on which one in three Kentuckians rely, including more than 660,000 Kentucky children. In addition, the Governor’s budget provides funding for 500 additional slots in the Michelle P. Waiver program and 100 additional slots for the Supports for Community Living waiver program.

“Families across the commonwealth depend on Medicaid. It’s simply the right thing to do to fund this program and expand the services offered through it,” Gov. Beshear said. 

“We thank the Governor for his support of critical programs that provide health care and support Kentucky’s most vulnerable populations,” said Cabinet for Health and Family Services Secretary Eric Friedlander. “He recognizes the residual positive economic impact, and without taking his eyes away from the fundamental role of government. The Governor’s support for Medicaid benefits others, including Kentucky’s children and our commonwealth’s provider community. In the most recent fiscal year, over 32,000 Medicaid providers were reimbursed for over $6.4 billion. Our Governor clearly recognizes the positive impact on the lives of Kentuckians with his support.”

Addressing Kentucky’s Nursing Shortage
Another priority in the Governor’s budget is to address the critical nursing shortage in Kentucky, which led the Governor to declare a State of Emergency in December 2021 followed by an Executive Order to help boost enrollment in nursing training programs.

“Our nurses are the brave, compassionate health care heroes who care for our people daily,” said. Gov. Beshear. “We knew before how important they are, but now we’ve seen just how critical as we’ve navigated COVID-19. We’ve got to act and support Kentucky’s nurses as they’ve supported us since Day 1 of this pandemic.”

To help recruit and retain nurses, the Governor is providing $6 million each year to increase the number of scholarships awarded to potential nurses. Current scholarships are financed by a portion of nursing licensing fees, which only supports around 150 students. The Governor’s budget doubles the maximum award from $1,500 per semester to $3,000 a semester.

Another burden many nursing students face are student loans; a hurdle which the Governor’s budget addresses head on through a student loan forgiveness program that would begin in May 2022. The Governor’s budget would provide $5 million each year for five years to provide student loan forgiveness up to $3,000 annually for each year a nurse or nursing faculty member is employed in their position in Kentucky.

The Governor’s budget also directs $2 million from the American Rescue Plan Act (ARPA) State Fiscal Recovery Funds to finance a marketing and outreach program for the nursing profession to enhance recruitment.

Lerae Wilson, DNP, chief nursing officer and vice president of patient services for St. Claire Healthcare in Morehead, said in a video message: “The pandemic has shown us that while nurses are good at what we do, mandatory overtime can only continue for so long. And with the shortage like it is, we have got to have people who are willing to step into those shoes and continue this fight. Thank you, Gov. Beshear. The investments you’re making today will ensure there is a steady workforce of nurses who are able, willing and proud to care for the people of the commonwealth.”

Nursing Homes
Also included in the Governor’s budget is funding to extend the $29 per-diem reimbursement rate increase for nursing homes, which expired on Dec. 31, 2021.

“My budget recommends $150 million annually to nursing homes to maintain the $29 per-diem reimbursement rate increase through June of 2024. Our nursing homes saw unimaginable hardships during COVID-19 and they need our support,” Gov. Beshear said.

Local Health Department Transformation
“Something else we learned and continue to learn in this pandemic? The important role of our local health departments,” said Gov. Beshear. “From testing, to keeping our people informed and administering the life-saving vaccines and boosters, our health departments are on the front lines helping our people daily. They work with little resources, yet they are always there for us. Now, my budget is stepping up for them.”

In his budget, the Governor provides more than $36 million through fiscal year 2024 to transform Kentucky’s local health departments, with funds to be allocated to the 60 departments serving communities across the commonwealth. The funding will be used to help with staffing and workforce, as well as operations to deliver the programs and services Kentuckians rely on.

Investing in Mental Health Services
The Governor reminded Kentuckians that mental health is health care, and his budget targets two strategies to help provide support and care for those in need.

First, the Governor dedicated funding to implement the new 988 crisis support line: a three-digit number set to replace the National Suicide Prevention Lifeline in July 2024. The budget dedicates $3.4 million in fiscal year 2023 and $9.9 million in fiscal year 2024 to phase in 170 additional staff to Kentucky’s Community Mental Health Centers to offer support 24-hours a day, seven days a week and 365 days a year.

The second budget allocation toward mental health is funding to expand Tim’s Law to two other psychiatric hospitals in the state – Eastern State Hospital and the Appalachian Regional Hospital. State funding of $500,000 and $1 million during the two fiscal years will fund the expansion.

Kentucky Pediatric Research Trust Fund
“Childhood cancer is the No. 1 cause of death by disease in children. That’s always been a devastating statistic for me to talk about, but last year, it became personal for Britainy and me when my hero, David Turner Jr., died of brain cancer after an incredibly courageous battle. He was just 9 years old,” said. Gov. Beshear.

To help fuel research to find new treatments for better outcomes among Kentucky’s youth, the Governor is adding $1.25 million each year from his budget to the Kentucky Pediatric Research Trust Fund’s base funding of $2.5 million. This organization serves as an umbrella to organize all pediatric cancer research work across the commonwealth.

Protecting Children and Families
To further carry out the Governor’s commitment to addressing domestic violence and child abuse, the Governor included a 34% increase in funding to Domestic Violence Centers, Rape Crisis Centers and Child Advocacy Centers.

The Governor emphasized the important role these centers play, stating, “These centers not only help during the immediate moment of need, they also help survivors overcome and go on to lead full, healthy lives. Their work is critical, and we cannot afford to overlook their services and the impact they have on our people.”

In addition, the Governor’s budget includes additional funding of $19.6 million each year to sustain and expand prevention services that work with families to mitigate issues when a child is at immediate risk of removal.

The Governor also included a 17% rate increase for residential and therapeutic foster care providers. These are organizations that serve children who require the highest quality care and aren’t yet able to be placed in a family-based setting.

Child Care Assistance
“Far too many Kentuckians have struggled far too long in silence, balancing the responsibilities of a career and caring for their child,” said Gov. Beshear. “That is why my budget further invests in child care, which is a critical need to help our families, but also our workforce.”

The budget includes a $2 per child per day increase in the child care assistance program reimbursement rate. This one-time funding would use ARPA funds to continue the temporary increase through June 30, 2024.

New Office of Dementia Services
The Governor also acknowledged the need for more support for the 73,000 Kentuckians with Alzheimer’s disease and other dementias, as well as for their caregivers. To help meet this need, the Governor’s budget includes funding to help staff the new Office of Dementia Services established in 2021.

The Governor’s budget also expands funding for the Kentucky Family Caregiver Program by $1 million in each fiscal year and includes additional dollars to expand the Hart-Supported Living program by $2 million in each fiscal year.

Combating Senior Hunger
“During the pandemic, we learned hunger remains a major problem among Kentucky’s older population. There is no excuse – no person in our commonwealth should worry about their next meal or go to bed hungry,” said Gov. Beshear.

To combat hunger in seniors during the pandemic, the Governor used pandemic funds to eliminate a waitlist for about 7,000 for meals. To ensure those individuals continue to receive food and support, the Governor is providing $36.2 million over the next two and a half years for an additional 49,000 meals per week, which fully meets the current needs of Kentucky’s citizens.

“Our cabinet also appreciates the Governor’s continuing support for the children in residential care and for the support for continuing to eliminate any waiting list for seniors who need access to meals and nutrition,” said Secretary Friedlander.

Caring for Kentucky’s Veterans
During Wednesday’s budget preview, the Governor also discussed the importance of stepping up for Kentucky’s brave veterans.

“Kentucky’s military veterans represent the best of Team Kentucky, and we have a sacred duty to take care of our people when their service ends,” Gov. Beshear said.

The Governor is providing $200,000 each year for the Homeless Veterans program. In addition, The Governor’s budget includes $700,000 annually to increase the number of veterans benefit field representatives and nearly $300,000 each year to expand outreach.

Other priorities included in the Governor’s budget to assist veterans include funding to boost staffing at four Kentucky veterans cemeteries and money to create a permanent memorial honoring Kentucky Medal of Honor recipients at the campus of Freedoms Foundation in Valley Forge, Pennsylvania.

Finally, the Governor’s budget provides $1 million in fiscal year 2024 to phase in operations at the newest state veterans center in Bowling Green.

Responsible and Real Budget
The state is rapidly recovering from the economic impacts of the COVID-19 pandemic and saw record new private sector investment in 2021. The state’s successes under Gov. Beshear’s leadership have vaulted Kentucky’s finances to a historic level, which has set the table for game-changing investments. The state’s budget strengths include:

  • An all-time, record-setting revenue surplus with $1.9 billion more in General Fund revenues than budgeted;
  • Best back-to-back growth rate since 2005-2006;
  • General Fund receipts have grown over 15% in the first half of the current fiscal year;
  • Gov. Beshear continues paying down on the commonwealth’s pension liability;
  • State has the lowest debt ratio since the policy was adopted; and
  • Largest rainy day fund in state history.

The Governor thanked the full-time Executive Branch budget staff for their unmatched experienced and for working every day to communicate with the Executive Branch on budget needs.

Gov. Beshear Unveils Budget Investments to Create, Attract Jobs of the Future, Ready Workforce
On Tuesday, Gov. Beshear outlined his budget plan to make game-changing investments that will help the commonwealth become a national leader by turning two years of incredible progress into 20 years of prosperity for Kentucky’s families.

“We have the responsibility and the resources to meet this moment, to be bold and to leapfrog other states, not to tread water or punt on third down,” Gov. Beshear said. “With these dollars, my budget targets investments to create and attract the jobs of the future and works to align workforce readiness with business needs to ensure we can fill the high-quality jobs that are coming our way.”

Gov. Beshear Unveils $2 Billion Investment in Pre-K–12 Education
Monday, Gov. Beshear outlined his budget plan to make a record $2 billion additional investment in pre-K–12 education to create a world-class education system across the commonwealth, the single largest investment in this sector in state history.

“We must meet this moment by ensuring we have a world-class education system to support our future workforce,” Gov. Beshear said. “Perhaps the most important step in ensuring we are never a flyover state ever again is investing in our teachers, schools and students. We are the destination, but to stay a world-class destination for world-class companies, we must have a world-class workforce. And that starts with education.”

Budget Address
The Governor reminded Kentuckians that he will deliver his 2022 Budget Address on Thursday, Jan. 13, at 7 p.m. EST.