Medicaid and Obamacare
Senators Hatch and Coburn this afternoon released a list of ten reasons – examples of fraud, waste, and/or questionable policies – illustrating why Medicaid needs fundamental reform. To that can easily be added an eleventh, which comes in the form of an article in this morning’s Los Angeles Times: In California, a provider organization has sued to block reimbursement reductions from taking effect – less than a week after the federal government approved those reductions. In other words, a group of trial lawyers has taken it upon itself to play “back-seat driver” after the state passed, and the federal government approved, Medicaid reimbursement changes.
The story illustrates perfectly the ever-tightening vise states are facing with their Medicaid programs:
- At a time when states face budget deficits totaling a collective $175 billion, Obamacare is imposing new unfunded mandates of at least $118 billion.
- Because Obamacare prohibits Medicaid programs from altering their eligibility criteria, one of the few levers left for states to achieve fiscal balance comes through reimbursement reductions – yet even these are being micro-managed.
- The Obama Administration has proposed regulations that would impose more mandates on Medicaid programs seeking to adjust reimbursement levels, forcing states to climb through new bureaucratic hoops dictated by Washington in order to achieve budgetary savings.
- And the Supreme Court last month heard arguments in a series of cases from California that, if successful, would allow trial lawyers to launch many more suits like the one filed last week – creating uncertainty for states in a tough fiscal environment, and potentially resulting in judges weighing the minute details of provider reimbursement levels in Medicaid programs across the country.
Some of these trends precede Obamacare – but by imposing yet more mandates on broken Medicaid programs, the 2700-page law has only made states’ already difficult fiscal realities worse. It’s one more example of how the unpopular law does not represent true reform of America’s unsustainable entitlements.