California Healthline Features Recent News Related to Medicaid

California Healthline examines recent news related to Medicaid. Summaries appear below.

• Federal Medicaid reductions: AARP CEO William Novelli on July 27 sent a letter to House Energy and Commerce Committee Chair Joe Barton (R-Texas) and ranking member John Dingell (D-Mich.), as well as Senate Finance Committee Chair Chuck Grassley (R-Iowa) and ranking member Max Baucus (D-Mont.), saying that reducing Medicaid spending by $10 billion over five years "is not the answer and could create serious barriers to care for beneficiaries." Novelli said that changes to Medicaid are necessary, but he added that "Medicaid strains are a signal, ... warning us about the increasing magnitudes of failures throughout our entire health care system." Novelli wrote that "significant" savings could be attained through a more "rational" system for prescription drug spending, including more accurate payments to pharmacies, greater manufacturer rebates, as well as the use of evidence-based formularies and purchasing pools. Novelli also recommended that Congress make available more long-term care options, including expanded home and community-based services (CQ HealthBeat [1], 8/1).
  


• State Medicaid reductions: Reuters on Tuesday examined how many state governments are "working to cut billions of dollars" from their Medicaid budgets as a result of "rising health care costs; greater numbers of poor, elderly and uninsured people; and a reluctance to raise taxes." Arkansas Gov. Mike Huckabee (R), who is chair of the National Governors Association, said many states have Medicaid budgets that are growing at more than 10% per year. States seeking to enact "sweeping structural changes" to their Medicaid programs include Missouri, Florida, Georgia and South Carolina, Reuters reports. State efforts to cut Medicaid budgets "are roiling communities" and are "spurring a debate over how high the cost of compassion should go," according to Reuters. Some people have said that states should eliminate fraud and find other cost-saving measures that do not "jeopardize the life and health of the most vulnerable people," Reuters reports (Gillam, Reuters, 8/1).
  


• "Cash and counseling" pilot programs: Medicaid beneficiaries in "cash and counseling" pilot programs "were significantly more satisfied with their treatment than those receiving regular benefits," according to an evaluation of the program by the University of Maryland, Boston College and Mathematica Policy Research, CQ HealthBeat reports. Unlike traditional Medicaid programs that provide services directly to beneficiaries, experimental programs in Arkansas, Florida and New Jersey give beneficiaries money to manage their own services and purchases. Beneficiaries meet with counselors to help them make care-related decisions. The pilot study included 6,700 seniors, adults with disabilities and, in Florida only, children with developmental disabilities. The study was designed 10 years ago and funded by the Robert Wood Johnson Foundation, the HHS Office of the Assistant Secretary for Planning and Evaluation and the HHS Administration on Aging. William Ditto, director of the New Jersey Division of Disability Services, said the program "works very well," but he added that it "does not work for everyone." Michael Grady, assistant secretary for planning and evaluation at HHS, said the research about the program is "encouraging." Twelve additional states have been awarded grants to develop pilot programs since October (CQ HealthBeat [2], 8/1).

"The best cure for Medicaid's budget woes -- and the best medicine for its beneficiaries -- are market-based innovations by prescient governors," Regina Herzlinger, a Harvard Business School professor, and Tom Nerney, director of the Center for Self-Determination, write in a Wall Street Journal opinion piece. Herzlinger and Nerney advocate a consumer-driven approach to Medicaid that would allow beneficiaries to manage their own health care purchases, enable providers to design "innovative care programs" and encourage "intelligent choice." Addressing concerns by those who "worry about the ability of Medicaid's recipients to shop ... intelligently," they note that a 2003 evaluation of the Arkansas cash and counseling pilot program "found greatly enhanced satisfaction with caregivers and reductions in unmet needs, without impairment of health and safety"; a 38% reduction in neglect by caregivers; and fewer cases of fraud and abuse (Herzlinger/Nerney, Wall Street Journal, 8/2).