The Comptroller serves as the chief fiscal guardian of the state, a role that involves protecting and accounting for the state's assets. The following initiative is designed to strengthen Connecticut's system of financial reporting and enhance the state's ability to evaluate the effectiveness of state programs and spending.
I. Financial Reporting And Performance Evaluation
Conversion to Generally Accepted Accounting Principles : Commencing with the 1997-99 biennium the state is scheduled to develop its budget in accordance with Generally Accepted Accounting Principles (GAAP). Presently, the budget is prepared on a modified cash basis, which can create a distorted picture of the state's true financial position. The conversion to GAAP will place the state budget on a consistent and accurate reporting basis. The Office of the State Comptroller is prepared to make the accounting revisions that are required to support this conversion.
The conversion to GAAP budgeting will provide the state an opportunity to develop more accurate performance measurements for its programs and services. Businesses use GAAP as the standard for financial reporting because they need to know which of their product lines are most profitable and which are failing to deliver the expected returns. The state should evaluate its annual budgets in the same manner. The best way to control state spending is to redesign or eliminate those programs and services that are failing to deliver the expected results on a cost-to-benefit basis. GAAP will provide the financial information necessary to conduct this type of performance review.
Over the next year the Office of the State Comptroller will work to establish the programmatic accounting information that is necessary to conduct performance evaluations of state programs.
II. Health Care Reform Initiatives
In addition to carrying out her financial reporting responsibilities, Comptroller Wyman administers the employee benefit programs for state employees and, in so doing , continually looks for innovative ways to save taxpayer dollars and improve the lives of Connecticut's citizens. The following health care initiatives illustrate Comptroller Wyman's commitment to achieving these important goals.
Municipal Health Insurance: The Comptroller administers a health insurance program that covers approximately 166,000 Connecticut state employees, retirees and dependents. In recent years, the state plan has been successful in controlling health costs, while preserving benefit levels. In 1996, the Connecticut General Assembly approved a plan that allows the Comptroller to open the state health plan to Connecticut municipalities as a means of reducing their health insurance costs. The savings could be used to fund other priorities or for property tax relief. The Office of the State Comptroller is currently in the process of implementing the program and the target date for municipal enrollment is July 1997. Participation by municipalities will be strictly voluntary and there will be no cost increases to the state.
The Work Group for Health Care Access for the Uninsured: In recent years, Connecticut's uninsured population has grown dramatically and the vast majority of these individuals are from working families. In order to address this problem, the Work Group for Health Care Access was formed in May of 1996. The Work Group's diverse membership included Comptroller Wyman and state legislators, representatives of private sector businesses, labor, hospitals and physicians, insurance companies, HMOs and advocates for the uninsured. Work Group members released a final report in January 1997 that identified two promising reform concepts. The first involves expanding Medicaid to cover most or all of Connecticut's 80,000 uninsured children. The second includes a package of tax incentives to encourage small businesses to provide coverage for their employees. The Work Group unanimously recommended that the Connecticut General Assembly give priority consideration to these two reform concepts in the upcoming legislative session.
Long-Term Health Care Insurance: Americans are living longer, which is certainly good news. However, this trend creates a compelling need to plan for the future. Nationally, it is estimated that one out of four people will eventually need long-term care. This is an issue that can affect anyone at any age and is a multi-generational concern for many families, especially those with caregiving responsibilities.
Through the Office of the State Comptroller, the State of Connecticut will begin offering long-term health care insurance to its employees via payroll deduction. The insurance plan will be available at affordable group rates and employees will be responsible for the entire cost. The insurance will cover a full range of long-term care services, including both nursing home and in-home care. The policies are designed to protect the subscriber's assets as well, therefore insuring the family against the impoverishment that can result from a long-term illness. This feature is especially important since long-term care costs continue to rise -- nursing homes in Connecticut average over $66,000 per year.
An additional goal of this initiative is for the state to lead by example and encourage others to follow. Essentially the state is helping its employees to take responsibility and plan for their future. Private sector firms will hopefully emulate the state by offering their employees similar opportunities. In the coming year, the Office of the State Comptroller will examine ways to make long-term care insurance affordable to the general public. As more individuals purchase long-term health care insurance, they will help to ensure a better future for themselves and their families. At the same time, they can protect their financial resources and help reduce the state's Medicaid expenditures for long-term care. Ultimately, this initiative could help to improve the quality of life in Connecticut and save the taxpayers money.
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