PBS Newshour carried an
interesting segment on the government's plan
to eliminate entitlement in Medicaid, the idea that health benefits
are guaranteed to everyone regardless of total cost.
In its place the
federal government makes fixed payments to states and lets them
determine eligibility, and benefits. This program provided more
details. You can hear it by clicking on:
http://audio.pbs.org:8080/ramgen/newshour/expansion/2003/02/25/medicaid.rm?altplay=medicaid.rm
A Summary:
Medicaid is nation's largest single insurance plan covering 47
million, including one in 5 children, low-income pregnant women, many
of the elderly in nursing homes, and disabled adults.
Amidst huge state budget deficits, at least 26 states have announced
plans to reduce Medicaid coverage this year.
National Governors meeting in Washington addressed by Health and Human
Services Director Tommy Thompson, who laid out Bush administration
proposal for reorganizing Medicaid in most far-reaching basis in its
37 year history.
Some background: How Medicaid works:
Mediciad enrolments fall into two groups:
Mandatory populations: States must cover these populations by federal
law: poor children, children in foster care, poor pregnant women, 12
million poor elderly, and disabled people, including poor older people
who are also on Medicare.
Optional populations: States can choose to cover these populations:
children and parents with slightly higher income than the mandatory
populations, and disabled and elderly people in nursing homes.
(Medicaid pays for 50% of all nursing home care and covers 60% of all
nursing home residents.)
States receive matching federal money for money spent on both
Mandatory and Optional Populations. There is no cap on the federal
spending, the states spend what the need and can spend on their
populations. For most states, this is the second most expensive budget
item after education, last year totaling some $121 billion. Federal
matching funds totaled $159 billion, for a federal/state total of $280
billion.
The Bush program, proposes giving the states some increased federal
money for seven years, but then sharply limiting the rate of increase
in federal funding in following years. It also allows states
increased flexibility in defining and meeting its health goals.
Federal money for states' Medicaid programs would have two lumps.
First: Acute care needs, mostly for the mandatory populations, e.g.
hospital and doctor visits for poor parents and kids
Second: long-term care, mostly for optional population, such as
nursing home stays for the elderly, or care delivered to the
homebound.
Federal contributions to both streams would grow from year to year,
but not on the current open-ended, needs-based basis. The growth for
the first seven years would be more generous than now, but growth
would be sharply limited after that.
As proposed now, states would have the choice to join the program, but
states not electing to join would forfeit the temporary money
infusion.
Thompson emphasized to the assembled Governors that states should
consider the "exciting programs about keeping senior citizens in their
own homes without going into institutions, and give you the
flexibility to do that."
Based on this synopsis, I think you can conclude that this program is
designed to forcibly contain the costs of some 78 million baby boomers
hitting old age seven years from now, with their expensive
degenerative diseases, and the costs of caring for the disabled.