Medicaid Budget Provisions Would Reduce Benefits for 5M by 2015
Provisions in the House budget reconciliation bill (HR 4241) that would increase Medicaid "flexibility" for states would reduce benefits for 2.5 million beneficiaries by 2010 and for five million beneficiaries by 2015, according to a recent analysis conducted by the Congressional Budget Office, CQ HealthBeat reports. The legislation, which the House Budget Committee approved on Nov. 7, would allow states to establish alternatives to the Medicaid benefits package currently required under federal law.
According to the analysis, "On average, CBO expects that alternative benefit packages provided by the states would reduce per capita spending by 15% to 35% for the affected populations." The analysis added, "Most of the reductions would be for services such as dental, vision, mental health and certain therapies but also could include restrictions on the amount, duration and scope of coverage for other services."
The analysis estimated that the bill would reduce federal Medicaid spending by $12 billion between 2006 and 2010 and by $48 billion between 2006 and 2015. Provisions in the legislation that would allow states to require some Medicaid beneficiaries to pay premiums or higher copayments would save $10 billion between 2006 and 2015, about 80% of which "would be due to decreased use of services," according to the analysis.
The analysis said that "we assume that states would impose cost-sharing requirements primarily for services such as prescription drugs, physician services and non-emergency visits to emergency rooms." The analysis estimated that "cost-sharing" provisions in the bill would affect seven million Medicaid beneficiaries by 2010, adding that "about 17 million people -- 27% of Medicaid enrollees -- would ultimately be affected."
In addition, provisions in the legislation that would limit asset transfers to restrict Medicaid eligibility would save $2.5 billion over five years and $6.8 billion over 10 years, according to the analysis (CQ HealthBeat, 11/14).