Client Alerts, News Articles & Blog Posts

Everything you need to know about BMD and the industry.

The Reasoning Behind Governor DeWine's $775 Million Budget Reduction

This week, Governor DeWine announced $775 million in cuts to the state operating budget due to financial repercussions resulting from the COVID-19 pandemic.

The Reductions –The DeWine administration will reduce General Revenue Fund spending by $775 million between now and the end of the state fiscal year (June). The following reductions will be made for the next two months:

  • Medicaid: $210 million
  • K12 Foundation Payment Reduction: $300 million
  • Other Education Budget Line Items: $55 million
  • Higher Education: $110 million
  • All Other Agencies: $100 million

Recent Timeline The state is required by statute to have a balanced budget each biennium. As Ohio enters month 11 of its 24-month budget, the motivation to balance the budget is forcing the cuts. In making his announcement, the Governor chronologically broke down how Ohio arrived at its present condition:

  • February, the state was running $200 million above budget estimates;
  • April, the state was forced to shut down to mitigate COVID-19;
  • As of May 6, 2020, the state is $776.9 million in the red; and
  • He expects the state to continue to experience budgetary concerns for months. 

The ReasoningGovernor DeWine anchored his reasoning to future-facing concerns. He cautioned that, “[w]hile we do not know what the coming months will hold, COVID is here with us and will be here for months to come.” He hedged his possible cautionary actions by pointing to his unwillingness to draw from the Rainy Day Fund for the rest of this fiscal year (two months), but will likely need to tap the budget stabilization fund in the next fiscal year beginning in July. 

On MedicaidThe Governor said that cuts to Medicaid will not come at the cost of essential services, and that he believes they will be able to find savings within the system even as the state responds to the COVID-19 pandemic. Subsequently, the Director of the Office of Budget and Management indicated that much of the Medicaid cuts will be achieved as an adjustment to Medicaid managed care plan rates.

For more, contact Daphne L. Kackloudis 614.246.7508, dlkackloudis@bmdllc.com.

HHS Announces an Additional $20 Billion In Provider Relief Grants

The U.S. Department of Health and Human Services (“HHS”) announced an additional $20 billion in new funding for providers on October 1, 2020. Eligible providers include those that have already received Provider Relief Fund payments as well as previously ineligible providers, such as those who began practicing in 2020, and an expanded group of behavioral health providers confronting the emergence of increased mental health and substance use issues exacerbated by the pandemic. The new Phase 3 General Distribution is designed to balance an equitable payment of 2% of annual revenue from patient care for all applicants plus an add-on payment to account for revenue losses and expenses attributable to COVID-19.

DOL Proposes New Rule Regarding Independent Contractor Status - But How Will the Election Affect Its Future?

On September 22, 2020, the U.S. Department of Labor announced a new proposed rule regarding employee and independent contractor status under the Fair Labor Standards Act. The full text of the proposed rule is available here. The rule's drafters intend to reduce uncertainty and enhance the precision and predictability of the long-standing "economic reality" test, which currently relies on a multifactor balancing test.

Major Change to Franklin County, Ohio Eviction Process: Landlord Testimony Required

Although there is currently a nationwide temporary halt on all residential evictions through December 31, 2020 in place, the eviction process in Franklin County – which processes the highest number of evictions in the State of Ohio at approximately 18,000 a year – recently changed significantly.

UPDATE: Governor Dewine Signs HB 606 Granting Short Window of Immunity from COVID-19 Personal Injury Lawsuits

The Ohio General Assembly, in Am. Sub. H.B. No. 606, is in the final stages of passing a law that will prohibit lawsuits seeking damages from COVID-19. This includes injury, death, or loss to person or property if the lawsuits are based, in whole or in part, on the exposure to, or the transmission or contraction of the coronavirus, unless the defendant in the lawsuit acted intentionally or recklessly. In circumstances where this immunity does not apply, H.B. 606 prohibits such claims being aggregated and brought as a class action.

Revised Department of Labor FFCRA Guidance, Effective September 16, 2020

In response to attacks on the legality of the Department of Labor’s (“DOL”) Final Rule regarding the Families First Coronavirus Act (“FFCRA” or the “Act”), which took effect in April 2020, the Department of Labor issued new guidance on Friday, September 11th to formally address ongoing questions and concerns related to the COVID-19 legislation.