States struggle to balance budgets with Medicaid changes

Health News Florida: A provision in Florida's state budget bill that would have reformed the state's Medicaid system has been officially dropped by state legislators. "The House proposed a sweeping plan that gradually would have led to almost all Medicaid recipients enrolling in managed-care plans, while the Senate proposed a smaller expansion of a pilot managed-care program. … The $19 billion Medicaid program is a huge budget issue for the state, though the proposed House and Senate overhauls would not have saved much money in 2010-11 because of the length of time needed to carry out an expansion. The House proposal would have required almost all Medicaid recipients to move into managed-care plans over five years, while the Senate would have expanded a pilot program from five to 24 counties" (Saunders, 4/25).

Sunshine State News adds to the report, saying that the timing of the provision was poor. "Indeed, the Medicaid proposal was probably doomed when House leaders unveiled the plan with just a scheduled three weeks remaining in the legislative session. The Senate had already approved its own effort to overhaul Medicaid which, although dramatic, paled compared to the House approach. Neither side worked toward a real consensus, but it wasn't until Sunday that leaders took the idea off the table." Legislators said that with such vast changes, the provision needs more time to be accepted and passed, they expect to take the matter back up in 2011 (4/26).

The Columbus Dispatch: A matter under consideration in Washington could have a big impact on state legislators who are trying to balance their budgets. State leaders could see an extra cushion of money from the federal government in Medicaid reimbursements if Congress approves legislation that would continue paying a larger share of those costs after they are due to expire. "The higher federal reimbursement rate was included in the 2009 economic-stimulus package. It expires Dec. 31, but Congress is considering a $23 billion measure to keep the extra dollars flowing for six more months, through June 30, 2011." The federal government's average reimbursement payment is 64 percent, but under the stimulus version they pay 73.5 percent.

"Ohio didn't assume in its two-year state budget, which runs until July 1, 2011, that the additional federal aid would come, which is why it would be a handy windfall. But several states counted the extra money in their budgets" (Candisky, Riskind, 4/26).

The Syracuse Post-Standard: The expansion of Medicaid under the federal health reform law may not change the dependency of the uninsured on free health clinics. Even though many of the currently uninsured will be eligible for insurance under health reform, many are still needing care now. "In the meantime, clinics like Amaus are Durley's only option. Amaus sees about 120 patients each month … Health reform is not likely to put these free clinics out of business. If anything, the legislation may make them busier, said Dr. Lynn-Beth Satterly, founder and medical director of Amaus. That's because the new law will not provide universal coverage, leaving more than 20 million Americans uninsured, according to an estimate by the Congressional Budget Office." The law might also expand use of the clinics because "many doctors shun Medicaid patients because Medicaid pays so little. Amaus routinely sees patients who have Medicaid, but cannot get appointments with doctors" (Mulder, 4/26).

The New Mexico Independent: The change in Medicaid reimbursement rates by the federal government under the health reform law will greatly help states afford the program, but until the rates are enacted in 2014, states will be paying more. "In 2014, the federal government will pay 100 percent of health care costs under Medicaid, the government's low-income health care program, thanks to the new federal health care reform law. But between now and then the health care portion of New Mexico's state budget could soar — by one estimate $500 million annually - due to a confluence of factors including more people enrolling in the government program and federal stimulus dollars disappearing" (Jennings, 4/26).