November 15, 2005
By Dan Kurland

Medicaid redesign just watered-down version of original

Last week, the Manchin administration resubmitted its Medicaid Redesign Proposal for approval by the federal Centers for Medicare and Medicaid Services. What's different this time, and what does it mean for low-income West Virginians who depend on Medicaid?

The new proposal is essentially a watered-down version of the former. Previous discussion of expansion of Medicaid eligibility to new people is now hinted at only as a goal for the future. There is no longer discussion of placing a cap on expenses for each recipient (per-capita funding), a controversial cost-containment measure. There is no longer discussion of discontinuing the comprehensive federally mandated Early and Periodic Screening, Diagnostic and Treatment program. It is not clear whether these issues are off the table or simply out of the paper.

New simplified eligibility groups are once again indicated (four categories instead of the present 29), but with no discussion of the rationale or anticipated benefits to be gained by this redefining of groups. The section laying out a comprehensive, integrated program for long-term care (home health, nursing home care, etc.) is as ambitious as before, but still lacking any suggestion of potential costs or how the goals might be achieved.

And again, there in no financial analysis — although this time that is stated up front: “Act-uarial review is necessary to determine if benefits and constraints will meet cost neutrality mandates.” There is thus no discussion of specific benefit changes (who loses what) and of the implications changes might have on program cost or beneficiary health.

At times, it seems that variant subcommittee reports have been cobbled together. The eligibility section spells out four groups, the benefits outline five. The discussion asserts the abundance of Social Security Supplemental Security Income recipients, but they are dropped as a category from the eligibility groups in the appendix.

The new version focuses on cost-containment measures — for which, many argue, no waiver is needed. The paper stresses the need for electronic health-information technology to monitor cost-containment efforts, and promises a long-range effort to implement such a system — a worthy goal, but hardly a source of savings in the near future.

The proposal spends much time discussing “health rewards accounts” that would reward or punish specific client behavior, such as quitting smoking (good) or missing appointments (bad), without providing any real sense of how such a program would operate in practice or the educational and administrative efforts involved. Examples of the success of such programs in the private market are indicated, but the jury is certainly out on whether they can work as effectively in a public program in which patients are only marginally responsible for the cost of their care. All of these efforts are well-meant, but untested, and yet they are relied on in lieu of any other concrete reform efforts.

Finally, in the conclusion, the rhetoric of the initial proposal is repeated: “West Virginia fervently believes that unfettered from the current Medicaid regulations it could reduce Medicaid growth and maintain appropriate services for Medicaid members.” What regulations? Unfettered how? Shouldn't it really say? The goals are laudable, but there is little discussion of how they might be achieved.

One would have hoped that this second draft would be more focused and more specific. Regrettably, one can only wonder why it is not. A Medicaid waiver might actually be a good idea at this time. Unfortunately, the case has yet to be made.

Kurland is health action coordinator of Covenant House and creator of the Web site www.criticalreading.com.