I am writing today to announce the closure of the New Mexico Independent. After three and a half years of operation in New Mexico, the board of the American Independent News Network, has decided to shift publication of its news…
While environmental activists played their part yesterday during demonstrations at the capitol building, going so far as to dress up as solar panels and to sing the tune of “You Are My Sunshine,” their counterparts, the anti-cap-and-trade contingency who has…
Roughly one quarter of University of New Mexico students are unimpressed with the state’s flagship public school, according to a survey that questioned college students about their higher education experiences.
State officials say they don’t know what they’ll do if Congress doesn’t send more money to help the state pay for Medicaid. Congress is currently debating whether to approve extra dollars for the government’s low-income health insurance program, but if the extra funds don’t come, New Mexico will be stuck with a $160 million hole in the state budget that starts next week—July 1.
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Come January, New Mexico could face a $300 million shortfall in its low-income health insurance program, and state officials are scrambling to figure out how to address a potential ocean of red ink. The state already has tried many cost-cutting measures—the “low-hanging fruit,” officials call them—to slow the cost growth in Medicaid. But now, because of the severity of the situation, they’re eying many previously off-the-table scenarios.
States across the country are responding to a funding crisis in Medicaid, the government’s low-income health insurance program jointly paid for by the feds and state governments, Laura Tobler of the National Conference of State Legislatures, told New Mexico state lawmakers at an interim legislative committee meeting this week.
Tobler’s message to lawmakers was simple: You are not alone.
California cut provider payments. Florida reduced funding for nursing homes by 10.5 percent. Massachusetts reduced adult dental services for 600,000 recipients of its low-income health insurance program.
Some states are taking several tactics, from fighting against Medicaid fraud to making care for high-risk, high-cost patients more efficient.
New York, a state with a history of Medicaid fraud, recently modified its management information system to better identify improperly paid claims. At the same time that state has created pilot projects with a focus on treating chronically ill Medicaid beneficiaries.
South Carolina, meanwhile, decided to post Medicaid payment information online to try to guard against fraud. It has also reduced—from 34 to 31—the amount of pills in each monthly prescription for Medicaid enrollees.
Utah, which has already cut optional services, created a preferred drug list. Such lists show what prescription drugs are approved for payment. In many cases, the lists limit the drugs to a certain number of drugs in each category of treatment.
The cutting has begun
New Mexico has already begun to make cost-cutting measures, such as starting with capping the amount of money managed care organizations can spend on administrative costs, New Mexico’s Human Services Secretary Pam Hyde said Wednesday.
“The good news is that we’ve already done many of these things,” Hyde said of the cost-cutting steps. “The bad news is that we’ve done many of these things.”
In other words, state officials are now looking for more ways to trim spending, including eliminating many, if not all, optional Medicaid services.
The potentially extreme measure is part of the mix this year because mandatory Medicaid services — such as hospital stays and physician services — are projected to grow to $550 million in early 2011. That’s compared to a projected $340 million for optional services.
If the state cuts $300 million to close the shortfall, very little money would be left for services that aren’t mandatory.
Cutting some optional services is a path Utah already has started down, Tobler said. That state eliminated vision, physical and speech therapy and chiropractic services, all optional under Medicaid, according to her presentation.
Spending cuts vs. tax increases
This tough economic situation has thrust legislators into the center of a fierce debate over spending cuts vs. revenue-side solutions like tax increases to fix the problem. Meetings have been planned around the state to collect public input.
The implications of such deep cuts are potentially dire for New Mexico, where one in four residents—more than 500,000 individuals—gets health coverage in whole or part through some form of public assistance. Medicaid provides the lion’s share of that coverage with more than 450,000 enrollees, according to Hyde’s agency.
“Some of these short-term cuts will create long-term problems” for people who receive these services, said Rep. Eleanor Chavez, D-Albuquerque.
Meanwhile, critics of raising taxes say the last thing a government should do during a deep recession is take money out of taxpayers’ pockets.
“We have to get back to core spending,” said House Minority Whip Keith Gardner, R-Roswell.
For many states, Medicaid is one of the biggest line items in their budgets. The program helps to underwrite a spectrum of services, from nursing home care and medications to vision and physicians visits.
But not all patients contribute equally to the cost of the program. Four percent of the Medicaid population is responsible for 50 percent of Medicaid spending, according to the Kaiser Commission on Medicaid and the Uninsured.
At the meeting, Rep. Dennis Kintigh, R-Roswell, wondered how many of those patients had those illnesses because of substance abuse. He also asked how much “life choices” contributed to the chances of people winding up on Medicaid rolls.
There is no silver bullet
Cutting optional services isn’t the only cost-saving measure under consideration. Another is the dismantling New Mexico’s State Coverage Insurance (SCI) program.
SCI helps pay premiums for thousands of low-income individuals, and small businesses take advantage of the program to insure employees, officials said.
Another cost-cutting option–and one generally considered to be one of the easiest to accomplish–is to reduce the rate of reimbursement to medical providers, such as physicians and nurse practitioners. Medicaid reimburses medical providers at various rates.
But even that can lead to unintended consequences like a diminishment in health care access, Tobler said.
”There is documented evidence that that reimbursement rate reductions leads to reductions in provider participation,” Tobler said.
How New Mexico will respond to the Medicaid problem, either in a special session scheduled for October or in the regular 2010 session in January — is not clear. But one thing is, say officials and state lawmakers. There is no silver bullet, a one-shot approach that fills the budgetary gap without parceling out some pain.
Thousands of low-income New Mexicans could lose medications, vision and dental services, hospice care and physical therapy because of a potential huge shortfall in Medicaid, Human Services Secretary Pam Hyde told state lawmakers Wednesday.
By now you know — or you should — that New Mexico has a big, fat budget hole.
Economists and other state officials estimate that weak tax revenue has left the state $440 million or so short of what it needs to cover expenses for the year that ends June 30. Gov. Bill Richardson and state lawmakers are negotiating over what to do about the shortfall, what to take off the table as an option and what to leave on. More …
The director of New Mexico’s Legislative Finance Committee, David Abbey, has won a national award for his work on budgetary issues.
Abbey was named the 2009 winner of the Legislative Staff Achievement Award by the National Association of Legislative…
