Officials estimate a Medicaid shortfall of $128 million.

AUGUSTA (AP) – Legislative budget writers heard more details Thursday from Baldacci administration officials in advance of next week’s public hearings on a $160 million supplemental budget package for the 12 months beginning July 1.

As was the case earlier this year when Gov. John Baldacci proposed wide-ranging cuts in social service programs, top Baldacci health aide Trish Riley told the Appropriations Committee that the administration would be willing to modify its latest proposals to reduce services for Medicaid beneficiaries “if others have better ideas.”

The administration has estimated a Medicaid shortfall for the upcoming fiscal year at $128 million and proposed a benefit redesign package to help cover the gap from July 1 through June 2005.

The governor has also proposed repaying $10 million to a retiree health insurance fund and spending about $22 million on a variety of departments and programs, including a $9 million hike in general purpose aid for education.

New spending would include:

• About $3.5 million in reclassification pay boosts for state police, warden service and marine patrol personnel and other enforcement officers;

• About $3 million to mental health programs and projects;

• $2.7 million to corrections to deal with prison overcrowding.

According to Baldacci administration officials, the governor’s supplemental budget proposal would offset shortfalls of $700,000 in general assistance and about $930,000 in the circuit-breaker property tax relief program.

The package would also free up about $417,000 for the Governor’s Office of Health Policy and Finance, according to Baldacci budget chief Rebecca Wyke.

The initiative to restructure Medicaid benefits as a way to generate savings coincides with the state’s move toward combining its departments of mental health and human services.

“I think that there’s tremendous opportunity,” said John Nicholas, Baldacci’s choice to head the merged department.

Responded Republican Rep. Sawin Millett of Waterford: “I’m wanting to hope that what you’re talking about will come to pass.”

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