“The current Medicaid program is arguably the worst health insurance plan in the country. It has expanded massively beyond the original intent in 1965 and is now one of the two or three largest budget items for nearly every state. In spite
of massive annual increases in spending, Medicaid chronically experiences budgetbreaking costs. Expanding Medicaid, as the new health care reform law requires,
will only compound these problems.”

“The ACA essentially imposes price ceilings on Medicare payments to providers. These price controls will lead to fewer health care options and lower quality of care for the Medicare population. In contrast, the Rivlin/Ryan approach would affect both the demand and supply side of the health care market – patients would shop and providers would respond. Provision for low-income beneficiaries in the form of health spending accounts could be structured to keep pace with the new system. The more realistic cost savings resulting from the Rivlin/Ryan proposal could be accomplished without the unintended consequences of price ceilings.”

Prohibit federal payments to states for Medicaid services related to health care acquired conditions.

Create a new Medicaid state plan option to permit Medicaid enrollees with at least two chronic conditions, one condition and risk of developing another, or at least one serious and persistent mental health condition to designate a provider as a health home. Provide states taking up the option with 90% FMAP for two years for health home related services including care management, care coordination and health promotion.

Create the State Balancing Incentive Program in Medicaid to provide enhanced federal matching payments to increase non-institutionally based long-term care services.

Establish the Community First Choice Option in Medicaid to provide community-based attendant support services to certain people with disabilities.

“Already, Medicaid is the second largest item on the average state budget at 21% (education is first at 22%). But according to the Centers for Medicare and Medicaid Services (CMS) that is all about to change very soon thanks to Obamacare. Remember, more than half of the health care coverage expansion under Obamacare is attained by placing Americans on Medicaid. CMS projects that state and local spending on Medicaid will increase 41.4% between 2010 and 2011. 41%!!!”

ObamaCare expands Medicaid by 16 million new enrollees, but current beneficiaries get poor quality care and face long wait times to find doctors. Providers frequently refuse to treat Medicaid patients because the reimbursement rates are so low. “Once the new law is fully in effect, roughly one in five Americans will carry a Medicaid card. But the combination of rapid beneficiary growth with benefit and provider cuts threatens to render their cards useless.”

“Incentives count, it turns out. People will do what they are paid to do. Doctors paid to implant stents will implant stents.
Doctors paid to think long and hard about whether a stent is necessary may be less eager surgeons. This story will not be the last in this genre as incentives settle into place under government-run health care.”

“While we applaud the Chairs’ initiative and efforts to reduce future federal outlays, we feel their proposals ultimately fail to provide an adequate plan for the fiscal future, especially for the unsustainable rise in federal health care costs. We believe that the proposals can contribute to the ongoing budget debate, but are not a roadmap. To help inform the healthcare budget discussion, we outline below the good, the bad, and the ugly policy prescriptions in the co-chairs proposal.”