Medicaid Transforming into Single-Payer Surprise; Governors Cry for Help as Their States Drown in Red Ink

Article excerpt


The battle over Medicaid's proper role in health reform has been a hotly contested tug of war thus far, but that likely will change as more governors join the fray and flex their collective muscle.

States are facing severe budget deficits and an increasing number of governors - Republicans and Democrats alike - realize they must make changes quickly to keep Medicaid from swallowing up spending on education, transportation and public safety.

President Obama's brimming 2009 stimulus package provided some short-term cash to the states to shore up Medicaid - the jointly funded federal-state health program for lower-income people.

But in exchange for the booster shot of funding relief, states had to agree to maintain their 2010 Medicaid eligibility levels or risk losing all federal matching funds for the program. That left them in an untenable situation.

In January, 33 governors and governors-elect wrote to Mr. Obama and congressional leaders requesting flexibility and relief from the excessive constraints placed on us by health care-related federal mandates.

States desperately need to reduce Medicaid spending because they already are foundering in a sea of red ink - a situation that will only get worse this June when the stimulus funding ends that initially helped many of them pay for added enrollment.

Typically, Health and Human Services Secretary Kathleen Sebelius responded to the cries for help by dispatching federal bureaucrats to help states explore options to hold down spending while still urging them to keep Medicaid enrollment at current levels until the health overhaul law takes full effect in 2014.

The governors' pleas for flexibility are notably bipartisan. California's Democratic Gov. Jerry Brown is asking for permission to cut $1.7 billion from his state's Medicaid program by limiting most recipients to no more than 10 physician visits a year.

Arizona's Republican governor, Jan Brewer, proposed tightening eligibility so the state could cut 280,000 people from its Medicaid rolls.

While Mrs. Sebelius said Arizona can trim its rolls under a different law, unfortunately most other states are in a straitjacket - requiring them to keep enrollment high and expand coverage by 2014 to all citizens under 133 percent of poverty - or about $30,000 a year for a family of four.

A number of recent estimates found this will mean adding an additional 20 million people to the rolls by 2019. …