Governors Get Advice From Obama Administration On How To Handle Medicaid

HHS Secretary Kathleen Sebelius provided information Thursday to state officials explaining ways in which current law allows them to change the federal-state program — to gain savings without slashing eligibility.

Los Angeles Times: Obama Administration Offers States Ideas On How To Cut Medicaid
Facing a revolt from states confronted by huge budget shortfalls and tattered health care safety nets, the Obama administration is intensifying a drive to help state leaders wring savings from their Medicaid programs (Levey, 2/4).

The New York Times: Governors Get Advice For Saving On Medicaid
Fearing wholesale cuts in Medicaid by states with severe budget problems, the Obama administration told governors on Thursday how they could save money by selectively and judiciously reducing benefits, curbing overuse of costly prescription drugs and attacking fraud (Pear, 2/3).

Kaiser Health News: States May Face Showdown With Feds Over Cutting Medicaid Rolls
Kaiser Health News staff writers Marilyn Werber Serafini and Julie Appleby report (in an updated story): “The Obama administration Thursday offered to help budget-strapped governors find ways to reduce Medicaid costs, but did not agree to urgent requests to sharply cut eligibility for the program, which covers 48 million poor, disabled and elderly people” (Werber Serafini and Appleby, 2/3).

CQ HealthBeat: Sebelius Reminds Governors Of Ways To Cut Medicaid Costs Without Slashing Eligibility
In the face of pressure from governors who want to cut Medicaid spending, federal health officials on Thursday sent information to state officials explaining how current law allows them to change the federal-state program. The effort seemed designed to persuade governors not to take draconian steps that would slash benefits and eligibility for low-income people (Adams, 2/3).

The Hill: Sebelius Offers Alternatives To Medicaid Waivers
In a new letter to the nation’s governors, President Obama’s top health official is trying to dampen calls from states for the federal government to loosen Medicaid requirements (Millman, 2/3).

Bloomberg: U.S. States To Be Allowed To Reduce Medicaid To Help in Balancing Budgets
The Obama administration is encouraging U.S. states to reduce health benefits to the poor instead of trimming eligibility for Medicaid, according to a letter to governors sent today. The administration’s message is an attempt to preserve access to Medicaid, the federal-state health program for the poor, while balancing states’ financial concerns, according to the letter sent by Health and Human Services Secretary Kathleen Sebelius. Along with cutting benefits and increasing the share Medicaid patients have to pay to save costs, Sebelius encourages states to save money on drugs, fight fraud, and better manage the most expensive patients (Armstrong, 2/3).

The Associated Press: Feds Give States Menu For Cutting Medicaid
Answering a fiscal 911 call from the nation’s governors, the Obama administration Thursday gave cash-strapped states a menu for cutting Medicaid spending, one of their biggest budget headaches. It didn’t have one item that many governors, particularly Republicans, are looking for. In a letter to governors, Health and Human Services Secretary Kathleen Sebelius was cool to the idea of cutting beneficiaries from the Medicaid rolls by restricting eligibility, as Arizona has requested and other states are considering (1/3).

Meanwhile, Stateline details how some states are using managed care as a cost conscious way to target new populations.

Stateline: Crushed By Medicaid Costs, States Expand Managed Care
States have been using managed care to cut Medicaid costs for more than 15 years. Up to now, however, the vast majority of plans covered only children and pregnant women — a large, but relatively healthy and inexpensive segment of the more than 60 million people covered by Medicaid. What’s different today is that states are beginning to target new populations for managed care. They include adults with disabilities and seniors who require long-term care, relatively small groups that nevertheless account for the lion’s share of Medicaid costs (Vestal, 2/4).

Related, earlier KHN story: Health Law Expected To Boost Medicaid Enrollees In Managed Care (Galewitz, 11/12/10).

And new research explores how income changes could impact the interplay between Medicaid and insurance exchanges.

Modern Healthcare: Researchers Expect Income Changes To Spur Movement Between Medicaid, Insurance Exchanges
Changes in income among those who will be eligible for subsidized health insurance under the Patient Protection and Affordable Care Act could lead to coverage disruption for about 28 million Americans within the first year as their eligibility shifts between Medicaid and the new state insurance exchanges, according to a study in the journal Health Affairs (Zigmond, 2/3).