This article was written by guest blogger J Walden Retan MD, State Coordinator, Health Care for Everyone- Alabama via the “Open Mic” category.
I was at a panel session yesterday evening where the effects of health care reform legislation were discussed. The panel was hosted by Over the Mountain Democrats in Birmingham Alabama. One of the panelists was Carol Steckel, Medicaid Commissioner in Alabama, head of the executive committee of the national organization of Medicaid Commissioners, and a friend. I know her as a sharp, articulate, absolutely straight arrow, professionally apolitical, incredibly hard-working and funny. She describes her response to the present legislation as a mixture of equal parts of excitement and terror.
In what follows, it’s useful to understand that the Alabama Medicaid program is truly a bare-bones program. It provides none of the optional services available in some state programs. It covers only the federally mandated candidates for Medicaid assistance. There are no services that could be cut to save money, no recipients of care who could be cut in order to save money if the state is to remain in the Medicaid program.
Carol talked about the high risk pools that are to be available for people with a pre-existing illnesses. These are temporary pools, scheduled to remain in existence for the next four years till other provisions of the health care reform legislation kick in. The new health reform bill provides $5 billion to cover all of these pools in all of the states for the next four years. $5 billion sounds like a lot of money. It is what the Alabama State Medicaid agency alone spends each year. Carol indicated that it was the consensus of everyone she has talked with that $5 billion won’t come close to covering the cost of these high-risk pools in 50 states for four years. She and a number of other Medicaid commissioners are leaning away from expansion or development of new high-risk pools in their states, not for political or philosophical reasons, but because the pools don’t make economic sense. As the federal bill is written, if states don’t act, a federal high risk pool is to be created to fill essentially the same function. Lots of luck.
There is a second problem for the high-risk pools for people with pre-existing illnesses. One eligibility requirement is that individuals have been uninsured for six months. This requirement effectively eliminates everyone who is presently a member of a state’s existing high risk pool.
Carol also spoke of the provisions of the new health care reform legislation that will add hundreds of thousands of new people to the Medicaid rolls. The bill provides 100% of federal dollars for the medical care costs of the new Medicaid participants for a couple of years. It provides 0% of the administrative costs. These and other provisions of the bill are going to create some very great requirements on state governments to provide major new funding for health care. They are going to force Alabamians to make some very, very difficult decisions within the next year or so…what, really, are the essential things we want our state government to provide? And what are we going to do to pay for them?