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Lawmakers are making final calls on the two year state budget, and hundreds of thousands of Ohioans are struggling with burdensome medical debt.

A newly proposed measure prescribes some potential relief.

That's this week in the state of Ohio.

Welcome to the state of Ohio.

I'm Sarah Donaldson in for Karen Kasler.

Six state lawmakers are now going over the differences between the budgets voted on by the House and Senate.

With the June 30th deadline looming, perhaps the biggest amendment.

The conference committee must decide on is a proposed 2.75% flat income tax in the Senate's budget that cuts taxes for Ohioans, making more than six figures.

Lawmakers also need to pick which plan to go with when it comes to the $600 million.

The Cleveland Browns want to build a domed stadium in Brook Park.

There's the house's version through a package of 30 year bonds or the Senate, which creates a grant program using unclaimed funds.

The conference committee will also decide on school funding and if districts should be limited in the property tax revenue, they can hold on to, with the rest refunded to property owners.

The House sets that limited 30%, while the Senate is at 50%, with some leeway.

Governor Mike DeWine has to sign the budget by June 30th.

He said this week that the only income tax cut he backs is one that assists working families.

He wants to see the restoration of his child tax credit, funded by a hike in the cigaret tax.

Advocates for kids and low income Ohioans are urging them to consider reinstating that $1,000 tax credit for families with kids under seven, as well as other budget cuts and changes.

My statehouse News Bureau colleague, Karen Kasler, sat down with one of those advocates from Groundwork Ohio.

you've said the Senate budget cuts $1.3 billion for kids and working families.

How did you arrive at that number?

Sure.

So we looked at the difference between the governor's proposed budget and where we're at in the Senate.

Most of that cut comes from both the Senate and the houses.

An unwillingness to include the child tax credit, which is $890 million over the biennium.

The second largest chunk of that is a cut, a true cut in child care from from what we're spending or investing today of 200 million over the biennium, coming from TANF funds, the Temporary Assistance for Needy Families, block Grant, which is a key resource, source of revenue for child care in the state.

And then the remainder are coming from, cuts to the maternal and young child health space, again, down from the governor's budget, but also including some real cuts, including the elimination of multi-year, continuous coverage in the Medicaid space for our babies who are eligible for Medicaid.

So, overall, lots of lack of missed opportunities to invest in kids and some real cuts, and eliminations to other programs like total and real total elimination of the, investment in lead poisoning prevention, for example, just leaving a lot of advocates wondering, you know, why and how do we build the priority around young children and families to deliver on them in these final days of of budget deliberations?

I want to talk to you about some of those things very specifically.

Governor DeWine said this week that the only type of tax cut that makes sense to him is a tax cut to help working families.

He touted that thousand dollar tax cut for families with young children, which was funded with a cigaret tax.

But Speaker Matt Huffman said he hasn't heard anybody talk about bringing that back into the budget, that it's not a tremendous tax break for many Ohioans and that low taxes in general are the way to keep the economy going, that higher taxes will force people, particular individuals, as he put it, to leave.

What would you want to tell leaders in the House and Senate about that tax cut, or that tax credit?

Rather, we have been trying to tell leaders that working families need relief.

So what I know is that working families who are working one, two, sometimes three jobs are feeling the incredible squeeze, whether it's the increase in cost of childcare, diapers, housing, food.

In fact, 82% of parents with young children we pulled in Ohio have cut back on their grocery spend to provide nutritious meals for their kids.

Over a third are challenged with housing costs.

Over half can't pay on their credit card debt, so the squeeze of all of those things that drive their family budget is just incredible.

And so when the proposal in the Senate budget around the income tax cut comes and there look, those families are trying to understand that proposal that only impacts families making above six figures.

They're feeling very left out, and they're feeling the bulk of the burden that they're carrying for their families when they're doing everything right.

There's $1,000 tax credit really make a difference for some folks.

Yeah, it really does.

So so consider a family in Columbus.

Mom and dad.

Dad's a construction worker.

A mom's picking up some shifts part time at a grocery store.

They're bringing in maybe $46,000 a year.

If they have two kids under the age of six, they get $1,000 child tax credit under Governor DeWine's proposals.

So that's $2,000 back on their taxes.

That's an increase in their overall income of 4%.

And that translates to rent a couple months of groceries.

So yes, it's a real relief, especially when if their tax burden, is is less than the credit, they can get cash back in their pocket.

So they're looking for their hard earned dollars to come back to their family when they are desperately trying to care for their family.

Let's talk a little bit about child care.

You have been asking for an expansion of publicly funded child care to 160% of the federal poverty level, and fully funding the Child Care Choice Voucher program.

Governor DeWine had proposed $225 million that was dropped to $200 million, and his head of the Department of Children Youth has said that Ohio's eligibility rate is among the lowest in the country.

Is that correct?

Absolutely it is.

It is so shameful that we are not leading in this space.

When you've got families crying, the business community crying out on behalf of employers to invest in working families to get them the the support that they need to be able to fully avail themselves of the workforce, to strategies to doing that as, as you mentioned, is to is to be able to reach more families above 145%, up to 200% of the federal poverty level.

We are, are, you know, pleased that the House has allowed the the, Childcare Choice voucher program to continue on serving the families it has in this past fiscal year, but a reduction of 25 million means less family served, on top of the lack of investment in increasing the federal poverty level from 145 to 160% of the poverty level.

That's where you really see that 200 million of off, impacting.

That means we're going to serve 20,000 less kids as a result.

The difference in the governor's version and what the legislature has has invested, the senator also eliminated the childcare credit program, under which child care costs would be split among employers, employees in the state.

I think the last thing I've seen was the state paying 20%, employers, employees paying 40% each.

And I mean this has been acknowledged as childcare affordability is a serious problem.

You mentioned the business community.

The Ohio Chamber of Commerce is among those.

It's advocated for making some changes in this space, conference Committee Chair Brian Stewart told reporters after the first meeting of the committee that both chambers have a significant additional expansion of publicly funded childcare.

And then he said, there is a finite amount of dollars, and we've done what we think we can afford to do.

What are your thoughts?

My thoughts are that $200 million are federal dollars.

We have access to that in this budget.

The governor's proposal was asking our ability to continue spending those on child care.

So it's not pulling from other opportunities or other investments in the state budget.

We're asking to spend dollars that can be spent on childcare, on childcare, to meet the demand of families.

Now, it's not true that, there's an expansion in eligibility because we haven't moved beyond 145%.

It is true that the 20,000 children who have become eligible through the Childcare Choice voucher in this fiscal year that the governor's, invested in, since the state of the state will continue to receive care.

But there has been no additional families then added on.

So I think that's a missed opportunity, especially when childcare demands are at a fever pitch from families, employers, and really, all of our communities.

You mentioned Medicaid too.

That's another area you're concerned about.

The Senate budget allows for the end of Medicaid coverage for babies under four, which was just started two years ago, but that was touted by, advocate as being a big deal.

Also, the Senate's budget will require Medicaid recipients to submit paperwork proving eligibility twice a year instead of once a year.

But what we heard in conference committee was the Medicaid caseloads are predicted to increase over time, and that something needs to be done to rein in those costs.

Yeah.

I mean, our our sort of shock is that the knee jerk reaction to curb Medicaid spending is to go towards our babies, where in fact, the policy that was championed by the majority caucus last budget was to ensure ongoing, continuous eligibility for babies who are born on Medicaid and continue to be eligible through age three.

And that is because the reality is that very few families and babies who are born on Medicaid are able to make that leap of self-sufficiency and not need to continue to get care through that through age three.

And so really, we we feel strongly that that's a way to reduce the administrative burden on the Department on Families, and there would be savings from less churn happening of babies coming off and losing coverage.

So that's a missed opportunity.

And it it makes child advocates really concerned because with the threats at the federal level and at the state level for Medicaid cuts, if the target is going to be on those babies and young children who actually cost less than the adults in the system and have the highest return on investment, if we invest in them early and intervene early on their their medical health, their mental health and invest in these families, it's not a good sign for the future.

So it's not where where I would be looking to cut costs, especially in a state that has one of the worst infant and maternal mortality rates in the nation, and the number of kids who are born on Medicaid, the number of kids who are in families that are receiving Medicaid.

That number is not dropping.

That's right.

Half of all about half of all births in Ohio are covered by Medicaid.

And we have 3 million adults and children that rely on it every day.

I saw on your website a reflection on fatherhood for Father's Day from Jeff Kramer, who's on the state's Commission on Fatherhood.

The Senate budget includes $20 million for the Responsible Fatherhood Initiative, which awards grants to community groups providing support to fathers.

Is that something that helps in all of the space?

Sure.

I think, you know, historically, we've been supportive of all the work that the Commission on Fatherhood has done and putting out grants to communities to help, heal and build fathers.

That's wonderful.

I'm married to a very responsible father of three myself, and so I think that's definitely part of the equation.

I hope that legislators, continue to provide like the rigor around impact around infant mortality and our other early childhood metrics, just as they do in the home visiting space and the infant vitality space.

So, I don't know exactly all the details of what the sponsors have in mind, but generally supportive.

What I would be very concerned about is that we talk to families.

We listened to them.

Moms and dads, and it's very hard to be responsible when you are doing everything right and all your responsibility in the world.

When you're working and trying to provide your family isn't paying off.

I mean, when you don't see that money come home and be able to provide and cover costs are very modest and very, you know, modest, frugal household.

So, I think that that has to be paired with actual financial investment in these families that are doing everything right, to build and reward responsibility.

The, you know, the values that we, that we all live by and do right by our kids.

You have a strong advocate in governor Mike DeWine going into this budget, this conference committee, obviously, this House and Senate have had some different ideas than his.

What are how optimistic are you that some of these things that you want to see restored, or at least brought back a little bit will be?

Well, I think as an advocate, I have to be optimistic.

But, there's nothing stronger, more reassuring than than hearing the leader of our state continue to prioritize the family tax cut or the child tax credit that governor DeWine has proposed.

And there obviously, the chambers are going to have to negotiate these large tax packages.

And I think we will do everything in our power to keep the priority on the working families who need it the most.

So, optimistic there, of course, again, with a variety of advocates in the childcare space and otherwise, you know, we're hopeful that all of those investments hold and we can continue to build from here.

We've got great and wonderful, some wonderful leaders and champions in both chambers.

So, here's hoping.

And our families deserve more than hope.

They need action.

So, we'll we'll hold them accountable either way moving forward.

Earlier this week, Groundwork Ohio held a rally at the state House.

And then they brought state lawmakers baby bottles alongside information about what they want reinstated in the budget.

One of the bills ready for lawmakers consideration after the budget is finished is a bipartisan proposal seeking to assist Ohioans with medical debt.

The bill would require them to pay down their debt, but would provide certain protections to them, like from losing their home or their income, or from leaving their credit rating in tatters.

The issue is brought together two lawmakers from opposite sides of the aisle.

So let's start with what the bill would do.

Your bill would cap the amount of interest on medical payments at 3%.

It would protect the credit of patients and prevent providers or creditors from seizing cash homes or properties.

I presume this comes from stories that you heard from people who were having experiences that related to this.

Yeah, absolutely.

I mean, you know, medical debt is the number one reason why people go into bankruptcy in this country.

And, if we can provide some kind of, fairness for people.

So I think what our bill does, it makes it makes the rules fair for a lot of people.

So, banning it from going on, credit reports, capping that interest, if it goes into collections at 3% and banning wage garnishments, I think really helps a lot of people, get ahead and be able to pay off those medical bills, because if you don't do those things, then people just fall behind and fall behind on other bills as well.

Have you heard any specific stories from people about what the damage of medical debt has been for them?

Actually, yes.

I have a woman who has colon cancer and she switched, hospitals.

And the one hospital has a very aggressive of, collection agency.

This going after she works three part time jobs and she's very worried about, this debt and the interest on it accruing.

I also have another friend who has, a child who's in her 40s now that's been very compromised all of her life with, tumors that keep continuing her brain.

And, and my friend is 75 years of age, 75 years of age, and she works full time because the insurance doesn't cover everything, and she wants to be able to pay off the debt that she has.

So, yeah, it's real.

And the and most of the time these people are response trouble.

Nobody plans to get sick and have a loss of wage, as well as a loss of an ability to work, either part, part way or or the whole way.

Nobody plans for that.

And, you know, now, now, you've already had some debt in your life, and now this is making that debt plus this debt, unreachable.

I want to ask about the 3% interest.

Why is that important?

And what level, are some of these debts at, if 3% is where you're capping it?

So some of these can go 8%, 12% or even higher.

So I mean, that's I would say that's higher than my, the, my car payment, 8% interest.

So capping that at 3% would really help people get ahead if your bill is in collections.

And that way you're not paying so much interest where you can't get ahead and can't pay the bill off.

And, probably also sacrificing a lot of your other, needs, like your housing, your food, your, utility bills, things like that.

So, you know, that's a really important thing to cap that interest at at 3%.

What are the credit rating protection?

I mean, credit trade groups say the state lawmakers have gone beyond their authority in doing these kinds of things in other states, and that leaving medical debt off credit reports does not give lenders a full picture of what borrowers can afford, and that that medical debt still needs to be paid back.

So why have that credit rating protection on there?

Because medical debt, can preclude you from being able to downsize your house, but you still have to get a loan again, I know this, from a from a friend of mine that worked in lending at a big national bank and now works at a community bank and said that they people were automatically denied if they had medical debt.

And she had a situation where the person wanted to go from the four bedroom to the three bedroom, from from a two story to a one story, and actually have less cash, in their debt portfolio, but was denied automatically because of medical debt.

Medical debt is treated differently than consumer debt, and there actually are some studies that show that just because you have medical debt, it doesn't mean that you are not likely to pay back that debt.

Like like you just said, medical debt is different than other kinds of debt.

Absolutely.

So medical debt is really a debt of necessity, right?

You know, no one no one expects to get sick or get cancer or or break a leg, or have an anesthesiologist that isn't in your network.

And, you know, now, now you have a bill that's a lot higher than you expected.

So it's, it's a it's a different kind of debt.

It's not like that.

You bought a car that you can't afford.

It's debt that people don't expect to have.

And now they're, they're saddled with this debt and they're having, you know, maybe trouble paying for it because again, like they're working three jobs and they're still trying to pay off the, you know, pay their bills or, you know, just living, you know, these are huge sums of money.

Yeah.

And and it's different than in when you accrue regular consumer debt, you've made a choice for that purchase.

Nobody chooses to have a debilitating illness or injury.

That's not something we wake up and go, oh gee, I hope I'm struck by lightning.

We don't do that.

But when you are struck by lightning now you've got the consequences of it, including a medical debt.

And so why do we make it so hard to get above that medical debt?

Let's ease it so that they can pay it responsibly and, and not suffer the consequences of not eating correctly or, not paying other bills, etc..

There is a federal consumer.

There is a federal Consumer Financial Protection Bureau rule that was finalized in January that would keep medical debt off credit reports.

President Trump has appointed new leadership at the Cfpb, and that agency is now reversed.

That role.

This is all in the court system right now.

The rule has been delayed until next month.

And there are lawsuits over this as well.

Do you expect opposition from Washington, from the Trump administration in trying to do this, trying to keep this debt off credit reports?

No, actually, the only opposition we've really heard from are the debt collectors.

Yeah, yeah, yeah.

And, you know, I think states really set an example for, these kind of things.

You know, we're trying to protect people, from having medical debt ruin their credit.

And, you know, I think a lot of people, get that, you know, medical debt, can stay on your credit report for seven years, and that's a long time for a lot of people to really get ahead in their careers or get get a house, to save for retirement.

Save for retirement.

So it really hinders a lot of people.

And, you know, we're trying to, again, trying to make the rules fair for a lot of folks.

This bill does not involve the purchase of medical debt by the state.

And that has been happening.

Some communities, Cleveland, Toledo, have initiatives.

Some states have actually done this.

Illinois and Connecticut, I believe.

Why not do something like that?

So I, I was part of the initiative in Toledo.

So it was we were the second.

So I was the one who spearheaded it in Toledo.

You know, I think with, I think we had great success with that.

But what I think people need is not just solutions, city by city.

We need solutions now for people and now for people to get ahead.

So hence the reason why we're doing these protections.

In this bill.

Because I think it's, it's going to help so many people just automatically and then get ahead, you know, for them to, to, to move on with their lives or plus those, those are urban areas that may have the resources to do that.

But when you go out to Pike County or, Adams County or Lawrence County, those areas don't have the resources to take on that initiative.

But this is something that can be applied across the state for everybody.

And you both have made it clear that this does not forgive medical debt in general.

People are still obligated to pay that debt back.

It's just there are protections as they're trying to do that.

Exactly.

It doesn't choke them with the collar.

It's not like taking the dog out and having the collar so tight they can't breathe.

They still have the constraints of that debt.

It's just doesn't choke them to the point that, they can't live at least as normal life as possible.

Is this the end of this, though?

I mean, when you start talking about medical debt and how many people have medical debt, how many people have sickness, get medical debt?

Is this just the start of reforms you'd like to see, or do you feel like this will be a solution that will settle things for at least the time being?

I don't think any legislation solves the problem permanently, so I'm sure there will be other reasons to come back and look at this.

Yeah, A legislative analysis of the bill shows it could have a financial effect on state and local governments through civil case filings in courts.

It suggests health care facilities might see modest revenue losses because of the changes to collection methods and recovery rates.

Those should be, quote, limited and absorbable, though, according to the analysis.

That's it for this week for my colleagues at the Statehouse News Bureau of Ohio Public Media.

Thanks for watching.

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Support for the Statehouse News Bureau comes from Medical Mutual, dedicated to the health and well-being of Ohioans, offering health insurance plans, as well as dental, vision and wellness programs to help people achieve their goals and remain healthy.

More at Med mutual.com.

The law offices of Porter, right, Morris and Arthur LLP.

Porter Wright is dedicated to bringing inspired legal outcomes to the Ohio business community.

More at porterwright.com.

Porter Wright inspired Every day in Ohio Education Association, representing 120,000 educators who are united in their mission to create the excellent public schools.

Every child deserves more at OHEA.org.