Magazine

Taking a Scalpel to Medicaid


A look at eight key states whose governors want to cut costs for Medicaid

Costs for Medicaid—the largest item in most state budgets—are ballooning, and federal stimulus funds that have been shoring up the low-income health-care program run out in June. To trim costs, governors want to cut payments to doctors and hospitals, reduce benefits to recipients, and tighten eligibility requirements. Here's a look at eight key states:

Arizona: Gov. Jan Brewer (R)

Plans to drop 280,000 Medi-caid recipients by tightening eligibility, saving $541.5 million next year. Halted funds for organ transplants in October; planning to slash payments to doctors and other providers by 5 percent on Apr. 1.

California: Gov. Jerry Brown (D)

Wants to cut $1.7 billion annually, including $709 million in reduced payments to physicians, hospitals, and other providers. Aims to raise $557 million with co-pays of $5 for doctor visits and $100 for hospital stays.

Florida: Gov. Rick Scott (R)

A former hospital executive, Scott wants to cut payments to nursing homes, hospitals, and other providers by 5 percent. In 2012 he plans to cap Medicaid payments and expand a managed-care system to save $4 billion over two years.

Illinois: Gov. Pat Quinn (D)

A new law tightens eligibility requirements and penalizes fraud, shifts more recipients into HMO-type care, and boosts co-pays for drugs. Savings of as much as $774 million are projected over five years.

Massachusetts: Gov. Deval Patrick (D)

Expects to save $1 billion a year by putting coverage of more than 800,000 recipients up for competitive bidding, limiting payments for "preventable admissions" by hospitals, and imposing co-pays for some services.

New Jersey: Gov. Chris Christie (R)

Says he will propose Medicaid "efficiencies" this year. The state's program faces a $1.4 billion deficit when the U.S. ends $900 million of funding.

New York: Gov. Andrew Cuomo (D)

Has asked a team of experts to find ways of "taking the fat out" of Medicaid; aims for savings of $2.85 billion next fiscal year.

Texas: Gov. Rick Perry (R)

Wants Washington to give states more control over Medicaid spending. A proposed budget by state lawmakers would slash Medicaid reimbursements to long-term care facilities by a third and trim payments to hospitals by 10 percent.

Data: Bloomberg


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