in Houston, Texas
States seek permission to trim Medicaid rolls; some governors mulling defying the law
Wednesday, Feb 02, 2011, 11:59AM CST
By Mark Lisheron

Governors are considering defying the law to do something about their Medicaid costs.

In an overview today from Kaiser Health News, some governors would like to follow the lead of Arizona Gov. Jan Brewer, who has asked for permission to drop some Medicaid clients. States are warning that the alternatives are reductions in payments to doctors and hospitals or cuts in other necessary state programs.
"They could even thumb their noses at the law and cut eligibility, which would force the Obama administrationto decide whether to cut all federal Medicaid funding to them," Kaiser reports.
The controversial Patient Protection and Affordable Care Act, which the U.S. House voted to repeal on Jan. 19, requires states to maintain their Medicaid eligibility levels for adults until 2014 when most of the provisions of the new law take effect. States are expected to make up for billions of dollars in stimulus money added to Medicaid which runs out in June.
Studies done for Texas suggest that the continued growth of Medicaid costs combined with the requirements of the new health care bill will eventually bankrupt the state. Medicaid accounts for more than 27 percent of the state budget, a figure that some studies project will top 30 percent without and more than 45 percent with the requirements of the new health care law.
Nationwide, 16 million more people are expected to become eligible for the program when the health care law goes into effect in 2014. Federal tax dollars will pay for the entire cost of the new Medicaid load for three years, with states expected to gradually pick up 10 percent of that total cost by 2020.

Contact Mark Lisheron at 512-299-2318 or

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Photo of stethoscope by flickr user a.drian, used via a Creative Commons license.

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