Health care funds restored and vetoed in Dunleavy’s final budget decision

On Monday, Governor Dunleavy announced his final decisions on the state operating budget through the enactment and line-item vetoes in HB 2001.

Back in June, Dunleavy signed the state operating budget while announcing over $400 million in line-item vetoes — many of them related to health and social services. During the legislature’s second special session, lawmakers introduced HB 2001, a bill addressing the PFD and putting back in place many of the vetoed funds.


Get the latest state-specific policy intelligence for the health care sector delivered to your inbox.


Dunleavy’s latest decision on the budget restores some of the funds he originally vetoed in June, but sustains the majority of vetoes related to health programs.   

The following funds related to health and social services were vetoed again:

  •  $50 million cut from Medicaid Services, in addition to the over $70 million already cut by the legislature. According to documents from the governor’s office, the Department of Health and Social Services is looking at several options to run the Medicaid program more efficiently:

“DHSS has been evaluating strategies within existing program adjustment options which include evaluation of services and utilization, program eligibility, rate adjustments and administrative simplification, as well as exploring flexibility for new program designs with our Federal partners.”

  • Elimination of the Medicaid Adult Preventative dental benefit – a cut of $27 million.
  • $6.1 million cut in behavioral health treatment and recovery grants.
  • A reduction of $7.5 million for adult public assistance which provides financial support for elderly, blind, and disabled Alaskans for basic living expenses.
  • A $2 million cut from the Nome Youth Detention and Treatment Facility.

Dunleavy announced the following restored funding:

  • $2.2 million added back to the Human Services Community Matching Grant and the Community Initiative Matching Grants programs. These grant programs assist qualified municipalities in accessing substance use treatment, mental health services, and other supports.
  • The Alaska Senior Benefits Payment Program had all of its funding restored – about $20.8 million with an additional $800,000.
  • $8.8 million restored for early learning programs including Early Childhood Grants, Head Start, and Best Beginning.