Medicaid: Covering cost-cutting efforts and impact of Health Policy

By Susan Jaffe

“Conflict makes a good story, and there’s nothing quite like Medicaid for conflict,” Matt Salo, executive director of the National Association of Medicaid Directors, told reporters at a panel discussion during AHCJ’s annual conference in Atlanta.

Medicaid provides health care to 60 million low-income Americans, funded roughly equally by state and federal governments. Salo said the broad program pays for 42 percent of the nation’s births and most of the long-term care for the elderly and disabled. It also is quickly consuming a growing portion of tight state budgets.

As states try to improve the quality and delivery of care amid “dysfunctional incentives,” Salo warned reporters that “You are going to see changes that look very short sighted and perhaps draconian. But the simple fact is that states’ balanced budget requirements means there is no other alternative. That’s conflict.”

Georgia’s Medicaid payments are already among the lowest in the country, said David Tatum, a lobbyist and vice president for government affairs at Children’s Health Care, which runs three Atlanta hospitals and 16 neighborhood clinics. “We lose 20 cents on the dollar,” he said.

Tatum described several challenges for Medicaid providers, including the Medicaid payment shortfall, the enrollment expansion required by the Affordable Care Act – assuming the Supreme Court lets it stand – and concerns about whether physicians and other providers will continue to participate in the program.  

In some areas of Georgia, families have to drive 60 miles each way to get to a Medicaid doctor, he said, and predicted “a helluva battle” next year in the state legislature over Medicaid funding.

Writing about Medicaid also poses challenges, said Christine Vestal, who covers health care for Stateline.  Benefits and eligibility requirements vary by state, she said, and suggested that reporters make themselves a cheat sheet “so at least you’ll be able to understand your sources.”

As an example of state Medicaid cuts that “don’t make much sense,” Vestal mentioned her story about cutbacks in a California program that keeps frail seniors and people with disabilities out of nursing home by providing medical care and other community-based services.   She said the program was cut even after a state-commissioned study found that California would lose money in the long run when beneficiaries eventually enter nursing homes, which cost Medicaid more than twice as much. (A portion of the funding was later restored, as the result of a lawsuit.)

Vestal suggested reporters focus on several areas for potential stories, including federal grants for innovative programs serving nursing-home-eligible seniors who receive both Medicare and Medicaid (the so-called “dual eligibles”), efforts to combat Medicaid fraud, and whether state public Medicaid programs that convert to private managed care to save money.

Managed care companies receive about 20 percent of Medicaid spending, which federal officials predict will grow to more than 50 percent in the next 18 months, Salo said.  

Panel moderator and AHCJ board member Phil Galewitz, who writes about Medicaid for Kaiser Health News, offered several resources to help reporters understand Medicaid, including:

• Kaiser Family Foundation’s Commission on Medicaid and the Uninsured

• Medicaid and CHIP Payment and Access Commission (MACPAC), for  state-specific information about enrollment, spending, eligibility levels, optional Medicaid benefits covered

• Office of Inspector General, U. S. Department of Health and Human Services, investigating Medicaid fraud

• Alliance for Health Policy

• Medicaid state program updates

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Susan Jaffe is a Washington, D.C.- based reporter specializing in health policy and aging issues. Her work has appeared in USA Today, The Washington Post, the Los Angeles Times, Kaiser Health News, the Chicago Tribune, The Center for Public Integrity, MSNBC.com, National Public Radio, Politico and other outlets.