Gov. Maura Healey on Wednesday filed a roughly $63 billion state budget plan that does not raise taxes or fees but trims some MassHealth benefits in a bid to contain skyrocketing health care costs.
Healey’s new budget, for the 2027 fiscal year that starts in July, would raise state spending almost 4% over the budget she signed last July.
That’s more than the anticipated growth in state tax revenue, but Healey cast the increase as much more moderate than it could have been given the erosion of federal funding and the rising price of providing government services.
Healey said President Donald Trump and Congress have cut more than $3 billion from Massachusetts’ federal funding. That meant, she said, the state was looking at a potential “double-digit increase in spending” when her team started developing its new budget.
“We can’t bankrupt our state while we try to address the federal shortfalls,” Healey said. “And we all agreed that we were going to work harder than ever to protect taxpayer money, to maximize every single taxpayer dollar allocated in this budget, and that we were going to control spending.”
The introduction of Healey’s spending blueprint is the first step in a monthslong budget process, and the version she ultimately signs into law this summer will reflect changes the state House and Senate make along the way.
Here’s a look at some of the major features in the governor’s budget proposal:
MassHealth benefit cuts: Under Healey’s plan, MassHealth, the state Medicaid program, would no longer cover GLP-1 weight loss drugs. There is currently no cap on dental benefits for MassHealth members, and her budget would institute a $1,000 cap for adults. Pediatric dental benefits would remain uncapped.
Healey’s budget team says these moves would bring MassHealth in line with similar states, including Connecticut, and with commercial health insurers.
Healey said federal cuts delivered a “huge, huge hit” to MassHealth. She said her health secretary, Dr. Kiame Mahaniah, worked with stakeholders to try to “lessen the pain.”
“Faced with an array of bad decisions, we tried to make the very best decisions that took care of the people that we thought needed most to be taken care of,” she said. “That’s how we approached it.”
Universal pre-k expansion: Two years ago, Healey set a long-term goal of providing “universal preschool access for every 4-year-old in our state.”
Healey’s latest budget takes another step in that direction with a $37 million investment, expanding a public pre-K initiative so that it will be available in all 26 of the state’s Gateway Cities.
Driver’s licenses and debt: Along with the financial piece of the budget, Healey is also filing a policy section that would end the practice of taking away people’s driver’s licenses for unpaid debts like overdue parking tickets and excise taxes.
The ACLU of Massachusetts last week touted a statewide poll by Beacon Research that found 78% percent of voters would support passage of a law stopping the state from taking away someone’s license solely because of debts unrelated to dangerous driving.
Traffic speed cameras: In another road-related policy, Healey filed language that would allow for a traffic camera program to enforce speed limits in construction zones and school zones. Speeding drivers would face warnings for their first violation, with a fine of at least $25 for future violations.
Healey included a similar proposal in this year’s budget, but the House and Senate dropped it.
Tax credits for farmers: Massachusetts farmers who donate food to food pantries would be eligible for a new tax credit of up to $5,000. That credit would sunset after two years.
State lawmakers will spend several weeks reviewing and hearing testimony on Healey’s budget, before rewriting it and passing their own versions in the spring. A final budget is supposed to be in place by the time the new fiscal year starts on July 1, but Massachusetts traditionally misses that deadline.
