Available Soon: Request your printed copies of the Idaho Freedom Index mailed to you!
Request Your Copies
Note to Dustin: This is currently only visible to logged in users for testing.
Click Me!
video could not be found

Senate Bill 1437 – Health and Welfare, Behavioral Health Services, Supplementals FY24 and Appropriations FY25

Senate Bill 1437 – Health and Welfare, Behavioral Health Services, Supplementals FY24 and Appropriations FY25

Niklas Kleinworth
March 22, 2024

The Idaho Spending Index serves to provide a fiscally conservative perspective on state budgeting while providing an unbiased measurement of how Idaho lawmakers apply these values to their voting behavior on appropriations bills. Each bill is analyzed within the context of the metrics below. They receive one (+1) point for each metric that is satisfied by freedom-focused policymaking and lose one (-1) point for each instance in which the inverse is true. The sum of these points composes the score for the bill.

Analyst: Niklas Kleinworth

Rating: -2

Bill Description: Senate Bill 1437 appropriates $142,903,700 and 788.41 full-time positions to the Department of Health and Welfare, Behavioral Health Services for fiscal year 2025. The bill also has supplemental appropriations for fiscal year 2024.

This legislation combines appropriations for the Divisions of Psychiatric Hospitalization, Behavioral Health Services, and Substance Abuse Treatment & Prevention.

Does this budget incur any wasteful spending among discretionary funds, including new line items? Conversely, does this budget contain any provisions that serve to reduce spending where possible (i.e. base reductions, debt reconciliation, etc.)? 

This legislation contains a couple provisions that aim to reduce wasteful spending within the Department of Health and Welfare.

First, the Division of Substance Abuse Treatment & Prevention stewards $19.2 million in federal funding in the form of State Opioid Response grants. These grants are primarily available to purchase and distribute naloxone, a medication that reverses opioid overdoses, to communities and first responders. However, these funds were also available to support harm reduction programs in Idaho. These could include needle exchange programs. 

Before the 2024 fiscal year, State Opioid Response grants were distributed to the Idaho Harm Reduction Project, a Boise-based nonprofit that primarily serves as a needle exchange. This nonprofit would distribute naloxone within communities, including to first responders, statewide. After legislators included intent language about this program in the 2024 fiscal year budget, these grants could only be used for first responders.

Similar language is included in this legislation, too. This prevents these grants from being wasted on funding programs like needle exchanges.

The second point to highlight is that this legislation transfers $3.5 million from personnel costs to operating expenditures in the Division of Mental Health Services. This came after the agency requested an identical amount in the form of supplementals for the 2024 fiscal year. This move indicated that these funds would be better suited to fund operations instead of staff.

All executive agencies will receive appropriations to pay for a 3% increase in employee compensation this fiscal year. Removing funds allocated to unfilled positions prevents the statewide increase from simply accruing in the department’s account and then being reallocated for other purposes. The cuts featured in this legislation prevent the agency from inappropriately using unfilled positions as an interest-bearing savings account.


Is the maintenance budget inappropriate for the needs of the state, the size of the agency, or the inflationary environment of the economy? Conversely, is the maintenance budget appropriate given the needs of the state and economic pressures?

This legislation confirms the maintenance budget for Behavioral Health Services at $135,462,000, growing it from the base by 25.2% in the last three years. This rate is just over seven percentage points faster than what would be prescribed by inflationary pressures and growth. 


Does this budget perpetuate or expand state dependence on federal dollars, thereby violating principles of federalism? Conversely, does this budget actively reduce the amount of federal dollars used to balance this budget?

Senate Bill 1437 appropriates $23,446,500 in federal funds to the Division of Behavioral Health Services. This constitutes just under one-third of the division’s total appropriation for the 2025 fiscal year. Additionally, one in five of the division’s full-time positions are federally supported. This demonstrates substantial dependence on the federal government to sustain programs and operations within the agency.


Does this budget contain hidden fund transfers or supplemental expenditures that work to enact new policy or are not valid emergency expenditures? Conversely, are fund transfers only made to stabilization funds or are supplemental requests only made in the interest of resolving valid fiscal emergencies?

Senate Bill 1437 features three supplemental appropriations within the Division of Psychiatric Hospitalization for the 2024 fiscal year. All of these appropriations are related to Medicaid billing for Idaho’s state mental hospitals.

This legislation covers a funding shortfall that occurred where Medicaid did not cover services rendered. This was largely due to nuances in patients’ conditions and the legal hurdles for when they may be discharged. Consequently, patients who stayed too long will not command any reimbursement from federal Medicaid funding for their care.

Additionally, State Hospital North and State Hospital West are requesting $1.7 million and $1.3 million, respectively, to cover a funding shortfall. These two institutions are awaiting Joint Commission accreditation and cannot receive Medicaid reimbursement until then. Both institutions are projected to exhaust their personnel funding before the end of the 2024 fiscal year. These supplemental requests would allow the two institutions to cover the funding gap.

All of these expenditures are emergency expenditures that properly require a supplemental request.

This legislation also contains three supplemental appropriations for the Division of Mental Health Services for the 2024 fiscal year. Two of these supplemental requests are for net-zero transfers from personnel costs to operating expenditures. These include $1.5 million for child mental health services and $2 million for adult mental health services. As of the 2024 fiscal year, the Legislature restricted the Department of Health and Welfare’s ability to transfer funds from personnel to operating expenditures. This was not anticipated in the agency’s original budget request.

The third supplemental request, however, provides for a $1.64 million net-zero transfer from the adult mental health program to the children’s mental health program. This funding is intended to support the first year of operations for the new youth crisis centers. Future costs would be reimbursed by Medicaid through the new Idaho Behavioral Health Plan. However, this shortfall was not unanticipated. This does not qualify as an emergency expenditure that would be a valid use of a supplemental request.


Idaho Freedom Foundation
802 W. Bannock Street, Suite 405, Boise, Idaho 83702
p 208.258.2280 | e [email protected]
COPYRIGHT © 2024 Idaho freedom Foundation
magnifiercrossmenucross-circle linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram