GAO Releases Medicaid Report LATE FRIDAY. OUCH!!!


Inquiring minds know that the Democrats are in big trouble by a report that the GAO released late on a Friday before a 3-day weekend…a sure sign that it wasn’t supposed to be noticed. Why would anyone want to keep a report quiet 26 days before a huge mid-term election where the subject of the report is reduced reimbursement rates AND higher taxes:

In a late Friday news dump, the GAO released a report detailing the impact of the Recovery Act on state Medicaid funding and enrollment. The report was given the Orwellian title: “Increased Medicaid Funds Aided Enrollment Growth, and Most States Reported Taking Steps to Sustain Their Programs”.

Enrollment growth? Check. In just the President’s first 6 months in office, Medicaid enrollment increased by a staggering 2.4 million enrollees, and over 5 million in total from January 2009 through October 2010.

Now about those steps taken by states to “sustain their programs”. What sort of steps? Well, according to the report, 38 states have enacted new taxes on health care providers, and another 5 are considering it. Twenty-two states are either implementing or considering reductions in benefits and services, and a total of 41 states are reducing or freezing rates paid to providers, or considering doing so. Obviously many states have taken more than one of these steps, 44 of them in fact.

No wonder an increasing number of doctors aren’t accepting Medicaid patients any longer.

Of course, nothing illustrates statistics better than a real world example…and the GAO report provides a couple:

Wisconsin Medicaid officials reported that the state would need to reduce Medicaid expenses by $1 billion annually, or about 20 percent of the state’s Medicaid budget, and are considering several options, including eliminating the state’s prescription drug program for seniors and several rate reform initiatives.

Colorado Medicaid officials reported that the state would need to reduce Medicaid expenditures by an estimated $250 million, in addition to approximately $320 million the state has already cut. The state reported that the additional expenditure reduction would require drastic cuts to optional programs, benefits, and provider rates.

The phrase of the day class is: Tip of the iceberg.

Which leaves them with a big gap to fill once the Recovery Act funding runs out. This program was originally scheduled to end this year, but Congress passed a bill in August which extends the program through June 2011. With the dramatic increase in Medicaid enrollments, and the federal share of Medicaid reverting back to pre-Recovery Act levels, the states’ share of Medicaid funding will increase by a whopping 40% on average, but the increase for some states will be much, much higher (e.g. +96% for Louisiana!).

This leaves these states with no choice but to find additional sources of revenue or to cut benefits, – and as this report demonstrates many are doing both. This is the legacy of the Recovery Act: $847B in spending with no economic recovery, and thanks to the shortsightedness of those who crafted the bill, millions of low income Americans will be losing benefits and even their doctors. And we will all be paying more for health insurance as providers pass the cost of higher taxes on to their customers.

Remember the Congressional and Senate members responsible for passing this trash and vote accordingly.

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One Response

  1. […] GAO Releases Medicaid Report LATE FRIDAY. OUCH!!! […]

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