Amid sweeping cuts in US budget Bush plans renewed assault on Medicaid

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[Zepps_News] #Amid sweeping cuts in US budget Bush plans

renewed assault on Medicaid

 

 

 

<http://www.wsws.org/articles/2005/feb2005/medi-f08.shtml>

 

Bush plans renewed assault on Medicaid

By Joseph Kay

8 February 2005

 

At the center of the sweeping domestic spending cuts unveiled by the

Bush administration Monday is the proposal for a major assault on

Medicaid, the main government program that pays for health care for the

poor and disabled in the US.

 

The proposed federal budget calls for cutting $60 billion from

projected

Medicaid spending over the course of the next decade. Overall, the

austerity budget is directed at boosting military spending and

extending

tax cuts for the rich, while seeking to compensate for the resulting

deficit by cutting back or eliminating funding for education, health

care and other social programs that aid the most vulnerable layers of

society.

 

Cuts in Medicaid will be one of the main ways that the administration

restrains spending on non-discretionary programs, which include Social

Security and Medicare. They account for nearly 45 percent of the total

amount slated to be squeezed out of these programs.

 

On February 1, in his first speech since being confirmed as the

administration's new secretary of health and human services, Michael

Leavitt described the administration's planned assault on Medicaid. The

new wave of cuts will have a severe impact on many of the 50 million

elderly, children, poor and disabled people who depend on Medicaid to

pay for needed health care.

 

Medicaid is funded jointly by the states and the federal government,

with the federal government paying between 50 and 77 percent of the

total bill, depending on the state. Medicaid now costs over $300

billion

a year, including both the state and federal portions. The share paid

by

the federal government is expected to reach $190 billion this year,

less

than half of the defense budget.

 

Outlays for Medicaid have increased by 63 percent over the past five

years, due largely to the economic downturn that has affected millions

of working people and poor, increasing the number of people eligible

for

Medicaid. In 2004, total spending by all states on Medicaid surpassed

total spending on education for the first time.

 

Each of the states manages and runs its own Medicaid program. So far,

the main impetus for cuts has come from state governments. At the same

time as Medicaid costs have increased, states have faced declining

revenues due to a combination of tax cuts and the economic slowdown.

State governments are required by law to balance their budgets, meaning

that any reduction in revenue must be met by a cut in spending.

 

The Medicaid law, passed in 1965, mandates that certain individuals

must

be covered and that certain services must be provided in all state

Medicaid programs. These include health care to poor children and to

elderly and disabled individuals who fall below very minimal income

levels. However, these individuals account for only a third of total

Medicaid spending. Most states provide " optional " services to other

people in need, including many disabled and elderly people. These

optional services are the immediate target of attack.

 

According to Families USA, a health care advocacy group, optional

beneficiaries include 6 million working poor adults, 5 million

children,

3 million seniors, 2 million people with severe chronic disabilities

and

3.5 million additional adults and children with medical bills that take

up most or all of their income.

 

In his February 1 speech, Leavitt indicated that the Bush

administration

plans to increase federal pressure on the states to carry out a

far-reaching transformation of Medicaid programs. " For Medicaid, [the]

window of opportunity is upon us, " he declared. " The time to act is

now. " While giving a verbal pledge not to cut services for mandatory

Medicaid recipients, Leavitt demanded that states take steps to cut

services for optional patients.

 

In particular, he called on states to shift optional patients from the

full services provided by Medicaid to private health insurance plans

that require the patient to pay for more limited health care. Echoing

the rhetoric used by the administration to push its Social Security

proposals, Leavitt said, " The optional populations...may not need such

a

comprehensive solution [as provide by Medicaid]...We can transform our

health care system so informed consumers own their own health records,

own their health savings, and own their own health insurance. Ownership

engages consumers, and engaged consumers get better results. " He also

called for more " flexibility " in the benefit packages offered to

optional patients.

 

He claimed that individuals exploiting the system to get services they

do not need are responsible for many of the problems in Medicaid

funding. He specifically targeted elderly people who transfer their

assets to their children in order to qualify for the poverty

requirements of Medicaid. This is one of the only ways that working

class retirees can get funds for adequate nursing home care. Medicaid

pays at least part of the bill for two-thirds of the 1.6 million

Americans in nursing homes. Leavitt proposed to save the federal

government $4.5 billion over ten years by cutting out these

" loopholes. "

 

" Medicaid must not become an inheritance protection plan, " Leavitt

declared. " Right now, many older Americans take advantage of Medicaid

loopholes to become eligible for Medicaid by giving away assets to

their

children. "

 

Leavitt declared that under his watch, the federal government will take

a harder line on states, thus increasing the pressure on the states to

cut services. He denounced the " Seven Harmful Habits of Highly

Desperate

States, " which he said were used to shift financial costs to the

federal

level.

 

In order to facilitate spending cuts, the Bush administration is

proposing to eliminate a provision that requires states to get federal

government approval before cutting individuals or services from their

Medicaid programs.

 

Over the past five years, every state in the country has either cut

services to some patients or cut some patients from Medicaid rolls.

Several states have recently announced major reductions in their

Medicaid spending.

 

Tennessee governor Phil Bredesen, a Democrat and former managed-care

executive, announced in January that the state would cut 323,000 poor

adults from its program, known as TennCare. The state will reduce

services for 400,000 additional patients. TennCare has been one of the

broadest state programs, covering nearly 25 percent of the state's

population, mainly people who are too poor to afford private health

insurance. Bredesen's cuts would eliminate most of those categorized as

optional recipients.

 

New York Governor George Pataki is proposing to cut $1.1 billion in

Medicaid spending by reducing services provided to some recipients,

particularly for mental health care, and increasing co-pays for drugs.

Pataki is also calling for closing the " loophole " used by elderly

people

to qualify for nursing home care under Medicaid.

 

Ohio Governor Bob Taft is expected to unveil a proposal this week to

purge 25,000 people from the state's Medicaid rolls by decreasing the

income-eligibility requirement to 90 percent of the poverty level. His

proposal would also eliminate a program for homeless and poor residents

who suffer from severe health problems and would cut out optional

services such as dental and vision care.

 

Florida Governor Jeb Bush has advanced one of the most far-reaching

proposals for cutting traditional Medicaid services. Bush is

essentially

proposing to privatize Medicaid. Instead of paying for services

directly, the state would provide grants to eligible Medicaid

recipients

to buy private health insurance. This would place the decision of what

services to provide in the hands of private corporations, while vastly

reducing government expenditures.

 

Joan Laker, a senior researcher for the Health Policy Institute at

Georgetown University, noted, " The intent [of the Jeb Bush plan] is

really based on the notion that the HMOs and private insurers will have

substantial flexibility to make a profit at the expense of the Medicaid

beneficiary, who essentially assumes the risk of not getting the

services they need. This is unprecedented for Medicaid. "

 

Jeb Bush's plan is the one favored by those who would like to see the

elimination of Medicaid as an entitlement program that provides a

secure

safety net for the neediest sections of the population. Bush's plan

goes

even further than Leavitt's proposal to shift optional patients to

private insurance.

 

An editorial in the Wall Street Journal, " Medicaid Rx, " published on

February 2, 2005, stated that the most promising answer to the Medicaid

problem comes from Florida. " In the best case, " the Journal wrote, " it

could lead to a remaking of Medicaid in the same way that reforms in

the

early 1990s in Wisconsin and elsewhere paved the way for an historic

and

hugely successfully national welfare reform. " The Florida system would

start " with letting participants decide how to spend the money

allocated

on their behalf. "

 

Welfare reform, implemented during the Clinton administration, has

sharply reduced welfare rolls by placing severe restrictions on who is

eligible to receive aid. The Bush administration is now pushing for a

similar radical restructuring of the Medicaid program, with cutting

optional services as a first step. In 2003, the administration

introduced a proposal for a form of block grant from the federal

government to the states, replacing the percentage allocations

currently

in place.

 

By capping the amount that the federal government contributes to the

Medicaid program, block grants place enormous pressure on states to cut

services. The proposal never got through Congress and block grants are

not currently on the table; however, they may come up in the course of

the budget negotiations between Congress and the White House.

 

The drug benefit added to Medicare in the administration's 2004 budget

is intended to force Medicare recipients to switch to managed care and

private insurers.

 

The main aim of the administration is to undermine the basic concept

behind not only Medicaid, but Medicare and Social Security as well:

that

the government should provide those most in need with services and

income. The attack on Medicaid is part of a systematic campaign to

drastically curtail and eventually eliminate all of the limited welfare

state programs enacted in the 1930s and 1960s.

--

 

 

 

Election 2004

The Triumph of the Swill

" The National Government will regard it as its first and foremost

duty to revive in the nation the spirit of unity and cooperation.

It will preserve and defend those basic principles on which our

nation has been built. It regards Christianity as the foundation

of our national morality, and the family as the basis of national

life. "

Adolph Hitler, My New World Order,

Proclamation to the German Nation

at Berlin, February 1, 1933

 

 

Not dead, in jail, or a slave? Thank a liberal!

Pay your taxes so the rich don't have to.

 

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