Cutbacks Imperil Health Coverage for States' Poor
Go 0ato OriginalBy Robin Toner 0aand Robert Pear
New York Times
Monday 28 April 2003
WASHINGTON, April 27 - Millions of low-income Americans face the loss of 0ahealth insurance or sharp cuts in benefits, like coverage for prescription drugs 0aand dental care, under proposals now moving through state legislatures around 0athe country.
State officials and health policy experts say the cuts will increase the 0anumber of uninsured, threaten recent progress in covering children and impose 0asevere strains on hospitals, doctors and nursing homes.
But those officials, confronting a third straight year of fiscal crisis, say 0athey have no choice but to rein in Medicaid, the fast-growing program that 0aprovides health insurance for 50 million people.
Many state officials are pleading for federal help as they face an array of 0apainful trade-offs, often pitting the needs of impoverished elderly people for 0aprescription drugs and long-term care against those of low-income families 0aseeking basic health coverage.
The issue is already roiling state legislatures. Almost every state has made 0aor is planning cuts in benefits, eligibility or payments to health care 0aproviders, according to the National Conference of State Legislatures.
The Center on Budget and Policy Priorities, a liberal research and advocacy 0agroup, estimated last month that as many as 1.7 million Americans could lose 0acoverage altogether under proposals advanced by governors or adopted by state 0alegislative committees this year.
Many more who keep their coverage may see it curtailed. Several large states, 0aincluding California, Florida and Ohio, are considering proposals to eliminate 0adental and vision coverage for adults. Mississippi and Oklahoma have reduced the 0anumber of prescriptions they will pay for. Other states, among them Kentucky and 0aMassachusetts, are moving to tighten eligibility or admissions criteria for 0along-term care services.
In response to the turmoil in the states, moderate Republicans on Capitol 0aHill have joined Democrats in seeking legislation that would provide additional 0afederal aid for Medicaid, which is financed by the federal government and the 0astates.
"You can't have cuts of the magnitude the states are undertaking without it 0aultimately harming health care for some of the most vulnerable low-income 0acitizens in this country," said Senator Susan Collins, Republican of Maine, a 0achief sponsor of the legislation. Another sponsor, Senator John D. Rockefeller 0aIV, Democrat of West Virginia, said, "You don't go down without a fight on this 0athing."
The Bush administration has opposed such legislation. Administration 0aofficials and many House Republicans say Medicaid, created in 1965 as a pillar 0aof the Johnson administration's Great Society agenda, is unsustainable in its 0acurrent form. Despite recent efforts to slow its growth, the cost of Medicaid 0ahas increased 25 percent in two years and more than 50 percent since 1997, and 0aenrollment is rising at the fastest pace in a decade.
Rather than simply pouring more money into the program, administration 0aofficials say they want to revamp it by giving states expanded power to run 0ait.
Short-term financing relief "does not solve the fundamental problem," said 0aBill Pierce, a spokesman for Health and Human Services Secretary Tommy G. 0aThompson. "That's why the secretary put forward the proposal he did. It changes 0athe funding mechanism and gives them greater opportunity to craft benefits that 0aare more flexible benefits."
Critics say the administration proposal is an effort to limit federal 0aresponsibility for the program by converting part of it into a block grant.
As Congress returns for a volatile debate over tax cuts and budget 0apriorities, many lawmakers and health care advocates say the strains on Medicaid 0awill loom large. The program, which now costs more than $250 billion a year in 0afederal and state money, is the fundamental health safety net for low-income and 0adisabled Americans.
Medicaid insures one-fifth of all children in the United States and helps pay 0afor two-thirds of all nursing home residents, many of them from middle-class 0afamilies whose assets have been depleted by nursing home costs, which average 0amore than $50,000 a year.
But Medicaid has ripple effects that touch many more Americans. "Medicaid is, 0ain many ways, a foundation for the health care system," said Dr. Herbert Pardes, 0apresident of New York-Presbyterian Hospital. "To cut Medicaid is to hit the 0aentire health care system."
States are now engaged in a sort of triage.
Senator John B. Breaux, Democrat of Louisiana, said that in his state, where 0alegislators face the prospect of cutting Medicaid's projected budget by 0aone-third, "they're saying: `What can you do to help? Because if you don't, 0awe'll have to cut the two most vulnerable areas, education and health care.' "
Signaling the political fight to come in Congress as President Bush pushes 0afor a tax cut of $550 billion over 10 years, Mr. Breaux, an influential member 0aof the Senate Finance Committee, said, "The problems we're facing now make you 0awonder why we're contemplating a tax cut of this size."
Even a state like Massachusetts, which has prided itself on expanding health 0acoverage, recently dropped 36,000 long-term unemployed people from the basic 0ahealth insurance rolls. State officials say Massachusetts may eliminate a 0aprescription drug program that covers 80,000 elderly unless the federal 0agovernment provides some help, and is considering a variety of other cuts and 0arestrictions.
"None of these decisions has been easy or fun," said Douglas S. Brown, acting 0acommissioner of the Massachusetts Division of Medical Assistance. "We're trying 0ato spread the pain as broadly as we can, and preserve the core as much as we 0acan, until better times come."
In Texas, Mr. Bush's home state, the House of Representatives has passed a 0abill that would set stricter eligibility criteria for Medicaid and the 0aChildren's Health Insurance Program. As a result, state officials said, 240,000 0achildren and 17,000 pregnant women would lose coverage.
Other proposed cuts have touched off passionate debate in Texas. People with 0aH.I.V. said at meetings of the state Board of Health this year that limits on 0alifesaving prescription drugs would amount to "mass murder" or a "death 0asentence." The Texas health commissioner, Dr. Eduardo Sanchez, echoed those 0aconcerns, saying "people would die" if the state cut treatments for AIDS and 0aother chronic illnesses.
Christopher J. Durovich, president of Children's Medical Center in Dallas, 0asaid: "The cuts mean that more kids will seek primary care in our emergency 0aroom, which is already overburdened. We would try to offset those cuts and the 0aburden of uncompensated care by seeking higher reimbursement from commercial 0ainsurers."
Gov. Rick Perry of Texas, a Republican opposed to new taxes, said state 0aofficials should not be swayed by "horror stories" or "doomsday scenarios." Gene 0aAcu a, a spokesman for the governor, said Mr. Perry was confident that "the 0aneediest in the state will have their needs addressed" in the budget 0aprocess.
Tennessee has removed 208,000 people, including 55,000 children, from its 0aexpanded Medicaid program, known as TennCare, in the last six months.
In Connecticut, a state law passed this year eliminates Medicaid benefits for 0a23,000 adults and 7,000 children. Oklahoma eliminated its "medically needy" 0aprogram, which provided Medicaid coverage for 8,300 people with catastrophic 0amedical expenses.
Indiana expects that 36,000 children will lose coverage under new rules 0arequiring them to re-establish their eligibility every few months. Colorado 0arecently adopted a law terminating Medicaid benefits for about 3,500 legal 0aimmigrants who have not become citizens.
Officials in other states say they are committed to preserving gains made in 0aproviding health insurance to children. But that means the states have to look 0aelsewhere for savings.
"We didn't propose to drop dental and vision coverage for adults because we 0athink they're not important health services," said Barbara Coulter Edwards, 0aMedicaid director for Gov. Bob Taft of Ohio, a Republican. "They're critically 0aimportant. But to preserve the coverage for kids, we had to do it."
State officials say many of the easier cuts were made last year, when they 0areduced payments to health care providers and tried to protect 0abeneficiaries.
But the cuts to doctors and other providers carry consequences, too. "I love 0amy Medicaid patients," Dr. Charles P. Anderson, a family doctor in San Marcos, 0aTex., said. "I've been taking care of some of them for almost 20 years. But if 0athese cuts take effect, we would systematically and gradually reduce the number 0aof our Medicaid patients."
State officials worry that doctors and dentists will become less willing to 0atreat Medicaid patients if payments are frozen or reduced.
Melanie Bella, Indiana's Medicaid director, said: "The State Legislature 0awants us to cut reimbursement, but we run the risk of driving providers out of 0athe program. We have not given physicians a rate increase since 1994."
Georgia reduced Medicaid payments to nursing homes in February. Fred A. 0aWatson, president of the Georgia Nursing Home Association, said the cuts reduced 0athe average daily payment for a nursing home resident to $92.50 from $98.50.
"Some nursing homes have dropped liability insurance, reduced staff training 0aand cut back the number of employees," Mr. Watson said.
Caught between soaring medical costs and declining revenues, states say they 0aface their most severe fiscal problems in decades. Some of those problems result 0afrom the recent economic downturn. Some result from policy choices made in the 0aboom days of the late 1990's, when states expanded Medicaid and other health 0aprograms to cover working families with modest incomes.
"Medicaid enrollment is growing now at its fastest pace since 1992," said 0aVernon K. Smith, a former Michigan Medicaid director who tracks Medicaid trends 0aacross the country. "Most of the enrollment growth is among families and 0achildren, but most of the cost growth is among the elderly and the disabled, who 0aaccount for 70 percent of Medicaid costs.
"That is the challenge for policy makers now," Mr. Smith said. "Any cut in 0aMedicaid is likely to have a disproportionate impact on the elderly and 0adisabled."
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