Bush Administration Sends Congress Draft Medicaid Reform Legislation
The Bush administration on Aug. 5 forwarded draft legislation to address Medicaid spending increases to Senate and House leaders, the Senate Finance Committee and the House Energy and Commerce Committee, CQ HealthBeat reports. Provisions in the bill and a related proposal from the administration on home-based alternatives to nursing home care "are much the same" as proposals detailed in the administration's fiscal year 2006 budget request, according to CQ HealthBeat.
With "[m]uch of the attention of late" focusing on the National Governors Association reform proposals and efforts from congressional staffers, the administration's draft legislative language "marks a fresh attempt" to influence reforms, CQ HealthBeat reports. Governors generally do not support Bush's proposals to end accounting practices that lead to increased federal reimbursements, but Bush's plan could save the federal government billions of dollars if Congress approves it.
Leighton Ku, an analyst for the Center on Budget and Policy Priorities, said there are some "new twists" to the administration's proposals, including a provision that provides for advance submission of state Medicaid spending plans in a way that allows federal officials to curb questionable accounting practices.
In addition, the draft legislation includes a cap on federal payments to states for administrative costs related to Medicaid, Ku said. To determine reimbursement for administrative costs, the administration would use 2003 as a base year and increase payments for each successive year by the percentage increase in the consumer price index plus 4.5%. Ku said the administration's draft legislation did not include programs to increase Medicaid funding that were highlighted in Bush's FY 2006 budget proposal earlier this year.
In a letter to congressional leaders, HHS Secretary Mike Leavitt said, "These proposals will help keep Medicaid affordable and sustainable for states and the federal government by restructuring reimbursements for prescription drugs, reforming rules for long-term care eligibility and strengthening the program's financial integrity" (CQ HealthBeat, 8/10).
In related news, some consumer advocates have said that a provision of the Medicare drug benefit that requires states to contribute to the cost of the program for some beneficiaries will lead to benefit reductions and increased out-of-pocket expenses for some Medicaid beneficiaries, Gannett/Detroit Free Press reports.
Kathleen Stoll, health policy director for Families USA, said, "We're very concerned. The only way states can control the money" being paid to Medicare "is to reduce their Medicaid eligibility" (Wheeler, Gannett/Detroit Free Press, 8/11).