TMA: Don't Cut Medicaid, CHIP

Cutting funding for Medicaid, the Children's Health Insurance Program, mental health care, or public health systems would be short-sighted and could have dire consequences, TMA and the leaders of 20 state special societies warn in a letter to state leaders.

"Cuts to programs such as Medicaid and CHIP, including physician and provider payment rates, are particularly penny wise and pound foolish as both programs bring generous federal matching rates to Texas," TMA President William H. Fleming III, MD, and specialty society leaders said in the letter to Gov. Rick Perry, Lt. Gov. David Dewhurst, and House Speaker Joe Straus. "In addition to helping provide needed health care services to many of the state's poorest and most vulnerable citizens, these federal funds help support job and revenue growth for Texas. Analyses by leading state and national economists show that federal Medicaid dollars have an economic multiplier effect of 3.25 times. Moreover, if the state fails to provide funding, services still end up getting provided. Unfortunately, county taxpayers will have to pick up the tab, but without the benefit of federal matching funds." 

The letter is in response to a proposed 5-percent cut in Health and Human Services Commission (HHSC) and Department of State Health Services funding. Governor Perry, Lieutenant Governor Dewhurst, and Speaker Straus asked all state agencies to develop plans to reduce their budgets by 5 percent because of a potential multibillion-dollar state budget deficit this year and next. The HHSC budget reduction proposal includes a cut of at least 1 percent in fees to physicians who treat Medicaid patients and a 2-percent cut for adult Medicaid services.

"The state budget for the current biennium is not insolvent," the letter says. "The state must avoid making decisions that may prove to be more costly in the long run. Instead of adopting indiscriminate, broad-based cuts, we encourage you to have a careful and open review of health care spending in order to develop a comprehensive plan that in the end will save the state money." Dr. Fleming and the other signers wrote. They asked officials to defer the cuts "until the larger implications can be carefully evaluated and new ideas considered." They encouraged them to convene a meeting of state agencies "to comb through the state's data and use it to identify strategies for 'bending the cost curve' and developing innovative, cost-effective new health care delivery models in Medicaid." 

They concluded by encouraging the officials "to work with us as partners to find targeted solutions that achieve our mutual goal of better care and at a more affordable price."

The April issue of Texas Medicine will have more information on the state budget problems and physician fee cut.

 

Action , March 1, 2010


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