13 states aim to limit Medicaid

By Phil Galewitz and Matthew Fleming, Kaiser Health News
Updated 2h 9m ago

Thirteen states are moving to cut Medicaid by reducing benefits, paying health providers less or tightening eligibility, even as the federal government prepares to expand the insurance program for the poor to to as many as 17 million more people.

States routinely trim the program as tough times drive up enrollment and costs. But the latest reductions — which follow more extensive cuts last year — threaten to limit access to care for some of its 60 million recipients.

"With more people on Medicaid, states will have to continue to ratchet down payments and limit services," says Nina Owcharenko, director of the Center for Health Policy Studies at the conservative Heritage Foundation.

Some worry the cuts to doctors and hospitals could make it more difficult to expand the state-federal program in 2014, as called for by the federal health law. "Some providers may be unwilling to accept new Medicaid patients," former New York Medicaid director Deborah Bachrach says.

But she notes the law may counter that effect with its funding boosts to community health centers and its temporary rate increases for primary care doctors, beginning in January 2013.

Most of the cuts went into effect this month, according to a 50-state survey by Kaiser Health News for USA TODAY. Among them:

•Illinois limited enrollees to four prescriptions a month; imposed a co-pay for prescriptions for non-pregnant adults; raised eligibility to eliminate more than 25,000 adults; and eliminated non-emergency dental care for adults.

•Alabama cut pay for doctors and dentists 10% and eliminated coverage for eyeglasses.

•Florida cut funding to hospitals that treat Medicaid patients by 5.6% — following a 12.5% cut a year ago. The state also seeks to limit non-pregnant adults to two primary-care visits a month, and to cap emergency room coverage at six visits a year.

•California added a $15 fee for those who go to the emergency room for routine care. It cut reimbursements to private hospitals by $150 million and to public hospitals by $41.5 million.

•Wisconsin added or raised monthly premiums for most non-pregnant adults with incomes above $14,856 for an individual.
Colorado, Hawaii, Louisiana, Maine, Maryland, New Hampshire and South Dakota also are making reductions to their programs.

Connecticut is weighing cuts likely to go into effect this fall.

A few states have increased Medicaid benefits, including Arizona, which will boost pay for mental health providers next April. And some are looking to restore cuts made during the worst of the recession, says Vernon Smith, managing principal with consulting firm Health Management Associates and a former Michigan Medicaid director.

Stacey Mazer, senior staff associate with the National Association of State Budget Officers, notes that fewer states are cutting the program this year, partly because many are in better economic shape and partly because of reluctance to make further cuts.

"States are hearing a lot of hue and cry about the impact on access," she says.

Last November, for instance, about 3,500 Medicaid recipients in New Hampshire had to find new doctors after cuts led LRGHealthcare in Laconia to stop offering primary care to non-pregnant adults, Senior Vice President Henry Lipman says.

"To see two decades of providing access for our community basically erased has been very disheartening," he says.

It is unclear how many states will participate in the law's Medicaid expansion since the Supreme Court ruled last month that they may not be penalized for opting out. A number of Republican governors have vowed not to participate, citing costs. Although the federal government will pay for the first three years, states will have to cover up to 10% of the costs after that.

Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a non-profit, non-partisan health policy research and communication organization not affiliated with Kaiser Permanente.

13 states aim to limit Medicaid