Q&A: Analyzing the candidates' health spending plans

Kevin Goodno served as commissioner of the state Department of Human Services during Gov. Tim Pawlenty's first term. He also co-chaired the Minnesota Budget Trends Study Commission, which released a report last year on the state's long-term fiscal outlook.

Goodno is now a registered lobbyist, and some of his clients do have interests in the areas of health and human services. He spoke to MPR's Morning Edition about health and human services spending.

Cathy Wurzer: Health and human services spending is expected to climb to $12 billion in the next two-year budget cycle, which would be more than a third of the state's budget. Why is health and human services spending growing so quickly?

Kevin Goodno: It's a combination of a number of factors. First of all the economy doesn't help. When people are losing jobs there are more people that come onto the public rolls and need help with their health care expenses. In addition to that, the health care programs paid for by the state are subject to the same pressures that the regular health care system is and the fact that there's inflation on that. And we can't forget that a large portion of the folks that are covered under state programs are those that are disabled or elderly and have been on or will be on the programs for a number of years.

Wurzer: I'm thinking there are demographic trends that really play into the overall equation.

Goodno: We are getting older. The fact is our population is graying. And in fact parts of our state are already experiencing that grayness, so to speak. They really do have a disproportionate number of elderly citizens that they need to take care of, so we have those challenges already in some parts of Minnesota.

Wurzer: Where would you start cutting the health and human services budget first?

Goodno: There's really no easy area because there's no easy program out there to just lop off. You're dealing with children, vulnerable children, you have health care services for the disabled, services for the elderly, and then you have the pot of families with kids who are under 100 percent poverty, people without jobs right now. If you think of the MinnesotaCare program [to cut], those are the only folks that arguably are the working poor let's say, but they're in challenging situations as well, and there's not enough money there to balance the budget.

Wurzer: What do you wish the candidates for governor were talking about when it comes to health and human services?

Goodno: I just think it's been really difficult for folks at the agencies, at the Legislature, to really grapple with the depth and the breadth of these problems. When I first came in as commissioner, I was tasked with coming up with $1 billion in cuts in the human services budget at that time. And we thought we made some pretty tough decisions. Since then we've had numerous budgets in deficit and they're forced to make even tougher decisions than we did. Having a broader discussion about what society expects and what society is willing to pay for out of the health and human services budget is something we have to do. If we don't have that discussion there's no way the politicians and folks who are elected are going to be able to make those decisions on their own. ...

The other thing is [during] my work on the Budget Trends Task Force, we identified long range that revenues on average will be outpaced by spending. So what that means is even if we were to balance the budget this year, and everything was balanced wisely and we weren't stealing or shifting things around, next year we'll be out of whack again.

The revenue streams, if you raise them, their inflationary factor is not as great as inflationary factor on the health care side. So somehow we either have to find revenues that will grow as fast as the health care expenses or we have to address the health care expenses. My answer is, tax increases may be part of a solution; they are not the only solution because inflationary-wise they don't keep up with the spending.

(Interview edited and transcribed by Elizabeth Dunbar.)