House Finance Division III advances budget changes, delays and targeted cuts; MCO payment timing and Medicaid rates among major moves

House Finance Division III convened for a work session to consider a large set of HB 2 amendments and related budget language, approving a package of changes to reduce the committee's biennial budget target and reallocate or delay spending.

Division leaders and members said the votes reflect an effort to meet a required budget reduction and to leave items for further review in the Senate. “We have unlimited wants and limited resources,” the chair said during the session, describing the group’s task as making “tough decisions” under scarcity.

The committee approved several high‑profile procedural and fiscal items. Most notably, members voted to delay the June 2027 managed‑care organization (MCO) capitation payment into the next fiscal biennium — a timing shift that generates temporary budget relief by moving a payment from late June into early July. The committee also approved a 3% across‑the‑board reduction in Medicaid provider rates as part of the division’s contribution to the biennial savings target. Members described those actions as painful but necessary to meet Division III’s assigned reduction target.

Votes at a glance - Withdrawal of amendment incorporating HB 548FN (membership‑based/direct‑pay health facilities) into HB 2 — withdrawn from HB 2 after discussion and public testimony (roll call as recorded in transcript: outcome withdrawn). Representative McLean’s member bill will remain as a stand‑alone measure in the Senate. - Amendment 13‑86 H (standing orders / clarify non‑Medicaid use) — adopted by the committee (show of hands; recorded as 9‑0 in the work session). - Amendment 14‑02 H (managed‑care outpatient cost‑sharing / patient incentives) — adopted (show of hands; recorded as 9‑0). - Amendment 14‑29 H (transition of Medicaid long‑term supports and services (LTSS) into MCOs) — withdrawn for further work; committee asked for a commission and recommended Senate policy deliberation instead (motion to withdraw approved by show of hands 9‑0). - Delay of June 2027 MCO capitation payment into FY2028 (amendment 14‑23 H) — approved by roll call, 6‑4. - 3% Medicaid provider rate decrease (amendment 14‑22 H) — approved (committee recorded vote 6‑4). Committee members and many provider witnesses warned of service and access impacts. - Developmental services / wait‑list funding: the committee voted to remove the HB2 suspension language that would have changed the statutory wait‑list requirement, and instead adopted reductions to the governor’s requested wait‑list funding levels (general fund reductions reflected in the work session: approx. $8.877 million in FY26 and $22.499 million in FY27). Members emphasized the department retains the ability to return to the fiscal committee if expenditures exceed appropriations. - WIC / farmers market incentive suspension (amendment 13‑92 H) — adopted (show of hands; recorded as 9‑0) to suspend a startup until the commissioner can identify funding.

Context and committee exchange Several health‑care provider associations and county officials testified during the session, arguing that rate reductions and cuts to developmental and home‑and‑community services would have downstream impacts: higher uncompensated care at hospitals, increased county tax burdens for nursing home support, and a risk that home care and community providers would exit the market. Ben Bradley of the New Hampshire Hospital Association, David Ross of the New Hampshire Association of Counties, Christine Stoddard of Bi‑State Primary Care Association, Greg White of Lamprey Healthcare, and others described the recent round of rate increases and the fragile state of workforce retention; many urged caution about reversing supports.

Committee members said they understood the provider concerns but emphasized the division’s constrained revenue allocation from Ways and Means and the need to meet a set reduction target. Several members said they preferred to give the Senate and policy committees additional opportunity to refine complex policy changes — for example, the committee withdrew the business‑model direct‑pay facility language from HB 2 to allow the Senate policy process to take the lead.

What’s next Items carried forward in the work session will appear in the Division III recommendations to the full House Finance Committee and, if approved there, will go to the Senate for further consideration. The committee repeatedly noted that some measures are temporary or deferred to allow more time for deliberation and stakeholder engagement.

Ending note The committee’s votes reflected a balance between making immediate budget reductions and preserving an opportunity for additional study and amendment in the Senate. Several members and outside witnesses asked the legislature to avoid destabilizing essential services while the Senate and future budget cycles consider longer‑term solutions.