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Rhona Wade of Wayne provides live-in care for her disabled sister. With an income that barely exceeds $600 a month, she relies on Medicaid prescription coverage to help pay for medications to treat a range of her own health problems, from a heart condition to high blood pressure.

DEALING WITH THE STATE BUDGET SHORTFALL

SOME OF THE reductions proposed last week in Gov. John Baldacci's second round of cost-saving measures:

-- Cut school spending by $34.1 million.

-- Cut $500,000 from the Gov. Baxter School for the Deaf.

-- Cut $7 million from the University of Maine System and about $2 million from the Maine Community College System.

-- Eliminate state jobs, resulting in a net loss of 71 positions.

-- Close six Department of Health and Human Services offices.

AUGUSTA — For Rhona Wade of Wayne, a widow who provides live-in care for her physically and mentally disabled sister, Medicaid is a godsend that almost fully pays for the six medications she takes daily to treat problems ranging from a heart condition to high blood pressure.

Her out-of-pocket cost was $285 last year, thanks to a $3 co-pay. Without insurance, Wade said recently, she would have to pay more than $7,800 a year for prescriptions.

A former secretary who signed up for Medicaid after cancer claimed her husband's life a few years ago, Wade has a monthly income that barely exceeds $600, from a life insurance annuity and her late husband's military pension.

And she could soon lose her drug coverage.

The latest round of budget cuts that Gov. John Baldacci proposed Wednesday would eliminate prescription coverage for thousands of Medicaid recipients such as Wade: adults with incomes up to 100 percent of the federal poverty level who have no children living at home.

That would trim almost $7 million from the state's general- fund budget, according to the Department of Health and Human Services.

"I think they should be able to cut different things" and safeguard prescription coverage for those who need it, said Wade, 56, who has two grown daughters. "It seems that, when a town or a state wants to cut, they want to cut what's necessary rather than what isn't."

Her suggested alternatives? Crack down on Medicaid recipients who abuse the system by racing to the hospital at the first sign of a sniffle, and trim the number of "higher-ups" in state bureaucracy.

With annual income of less than $8,000, Wade is known in Medicaid jargon as a "non-categorical" -- poor, childless adults who don't fit into any of the standard Medicaid categories, such as parents raising children.

"Non-cats," in State House shorthand, earn no more than $10,404 a year individually or $14,004 in a two-person household, according to the DHHS.

More than 18,000 of Maine's 267,000 Medicaid recipients are "non-cats," a number that Baldacci hopes to cut to 12,000 by the end of the next fiscal year, through attrition.

Funded by the state and federal governments, Medicaid provides services in Maine that are required by federal law as well as some that are not.

Maine has chosen to provide prescription coverage for people such as Wade. But it's a choice that Baldacci wants to reverse as he tries to offset a $190 million shortfall in the state's $6.3 billion, two-year budget without raising taxes or dipping into the state's savings accounts.

The cuts that Baldacci submitted to the Legislature last week followed a round that he sent to lawmakers in January, before state experts concluded that what looked like a $95 million budget shortfall actually is twice that size.

The latest cuts, which Baldacci has described as painful, extend across state government and include reductions in state aid to schools and funding cuts for the University of Maine System, the Maine Community College System and Maine Maritime Academy.

The Legislature's Appropriations Committee, which has completed public hearings on the initial cuts, will hold hearings Tuesday and Wednesday on the latest plan. The committee will then craft a budget of its own for the full Legislature to consider.

In addition to making the prescription cut for some Medicaid recipients, the new plan would force a separate group of about 5,600 Medicaid recipients to pay an annual $25 enrollment fee.

Advocates for the poor do not like either idea, but dropping prescription coverage for people such as Wade is the more controversial of the two.

The prescription cut would apply to what Sara Gagn Holmes of Maine Equal Justice Partners, an advocacy group, calls "the poorest of the poor," people who are even poorer than those who would pay the enrollment...