Bipartisan Team of Governors Reportedly Near Agreement on Medicaid Reform Proposal
A bipartisan team of 10 governors appears to have made progress toward an agreement on a Medicaid reform plan, the New York Times reports. The governors have been working on a plan of their own because many of them had objected to some elements of a proposal by the Bush administration (Pear, New York Times, 5/31). According to the AP/San Diego Union-Tribune, the plan would "endorse much of the proposal put forth by President Bush." Both the governors' plan and the Bush proposal would give states "considerable power to remake the program" (Meckler, AP/San Diego Union-Tribune, 5/31). Under Bush's proposal, states would have to maintain comprehensive Medicaid coverage for the two-thirds of beneficiaries whose income levels are low enough that the federal government mandates that they be covered, but for beneficiaries covered at the states' discretion, states could change Medicaid rules and regulations, simplify and alter eligibility requirements and revise or reduce benefits. States would no longer have to apply for federal waivers to deviate from federal standards for Medicaid eligibility and benefits. The proposal also would give states a fixed amount of money, rather than matching funds, for the beneficiaries whom they choose to cover. States that decide to join the new optional Medicaid program would receive additional federal funding of $3.25 billion in 2004 and $12.7 billion over seven years, but federal funding would decrease for the three years after that, resulting in a net of no cost to the federal government. Governors objected to the Bush proposal because they said it did not protect states against unexpected Medicaid costs that could arise from changes in the economy, natural disasters, disease outbreaks, terrorist attacks or the development of expensive drugs and other treatments. The governors, however, have offered support for the plan to give states more power to alter Medicaid benefits, eligibility rules and copayments (California Healthline, 5/27).
In a conference call on Wednesday, the 10 governors nearly reached a consensus on a proposal by Iowa Gov. Tom Vilsack (D) and Florida Gov. Jeb Bush (R) that would give states "sweeping new power" to modify benefits and eligibility for Medicaid beneficiaries considered optional for them to cover, the Times reports. In return, states would accept some limits to the growth of federal Medicaid spending. Under the plan, federal funding for Medicaid beneficiaries whom states are required to cover would continue unaltered, but states would receive a fixed annual allotment for beneficiaries covered at their discretion. Unlike the Bush administration proposal, the governors' plan would allow that cap to be increased to cover unexpected costs, such as increases in unemployment, natural disasters, disease outbreaks or the development of expensive medical treatments (New York Times, 5/31). The plan also calls for the federal government to pay for all the costs associated with seniors eligible for both Medicaid and Medicare -- a provision not included in the Bush plan, the AP/Union-Tribune reports. The governors' plan also would give all states new power to alter their programs. The bipartisan team intends to vote on the proposal tomorrow and the full National Governors Association executive committee plans to vote on the proposal later this week.
Vilsack said, "What's happening now is that states are opting to deal with these double-digit increases (in Medicaid costs) by denying access to health care, and the purpose of this program is to provide access to health care." While the proposal appears to have enough support within the governors' task force, there is opposition to the proposal, the AP/Union-Tribune reports (AP/San Diego Union-Tribune, 5/31). Missouri Gov. Bob Holden (D) said, "I cannot in good conscience support a Medicaid reform proposal that does not include adequate protections for the population we serve." Rep. Henry Waxman (D-Calif.), Sen. Tom Daschle (D-S.D.) and Sen. Edward Kennedy (D-Mass.) all have called on Democratic governors to vote against the governors' Medicaid proposal, the Times reports. A Daschle aide said, "Weakening Medicaid with a block grant is an absolute nonstarter with Senate Democrats." Kennedy added, "Adoption of any version of the administration's block grant proposal is unacceptable" (New York Times, 5/31). Ron Pollack, president of Families USA, said, "If this proposal is enacted, it would do more damage to the health care of low-income seniors, children and people with disabilities than any health policy change since Medicaid and Medicare were enacted in 1965." The proposals to reform Medicaid require congressional approval before they could be implemented, the AP/San Diego Union-Tribune reports (AP/San Diego Union-Tribune, 5/31).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.