Balancing Act

If I was asked to name one issue in 2005 that could affect millions of people with disabilities, it is the future of Medicaid. Medicaid, for you laypersons, is a joint federal-state entitlement program that funds health care for millions of low-income and disabled Americans. As a percentage of state spending, Medicaid is beginning to eclipse the other major budget component: education. The Bush Administration is widely anticipated to take on the ballooning costs of Medicaid in 2005. There’s been some talk about making Medicaid into a block grant program. This creates problems for states if Medicaid enrollments unexpectedly rise.
What the Bush Administration is really trying to do is address the massive deficit. Medicaid needs reform, absolutely. But there are other factors that need to be considered. Many states pay exorbitantly high reimbursement rates for prescription drugs. And don’t even get me started on payments to nursing homes. In FY 2003, $45 billion in Medicaid dollars were spent on nursing home care versus $4 billion in community-based services. If states could summon the political will to take on the nursing home lobby, it could result in huge savings for their Medicaid budgets. The role of perpetual institutional bias in our public health care programs needs to be acknowledged if we are really serious about controlling costs.
By the way, Medicare, a 100% federally funded program, doesn’t cover long-term care. In about ten years, that issue is going to reach a boiling point when all the boomers start clamoring for in-home care and state Medicaid funds won’t even come close to meeting the demand.