Some States Find Burdens in Health Law

This article only goes to show that new or expanded entitlements do not come without their own headaches. No matter how lauded this health care reform law was there will be some pain in attempting to implement this plan.

Because of the new health care law, Arizona lawmakers must now find a way to maintain insurance coverage for 350,000 children and adults that they slashed just last week to help close a $2.6 billion budget deficit.

Louisiana officials say a reduction in federal money to hospitals that treat the uninsured under the bill could be a death knell for their state-run charity hospital system.

In California, policymakers estimate they will have to come up with an additional $500 million a year to make necessary increases in payments to Medicaid providers.
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States with the largest uninsured populations, like Texas and California, might be considered by its backers the biggest winners to emerge from the law, because so many additional residents will have access to health insurance. But because those states are being required to significantly expand their Medicaid programs, they are precisely the ones that will face the biggest financial strains, in many cases magnified by existing budget shortfalls.

“The federal government has to account for states’ inability to sustain our current programs, much less expand,” said Kim Belshé, secretary of California’s Health and Human Services Agency.

In contrast, states like Massachusetts and Wisconsin, which already have extensive health care safety nets, do not expect to spend much more money, while still taking in billions in federal grants.

In Massachusetts, for example, which already has a form of universal coverage, the federal government will wind up taking over from the state a significantly larger share of the costs of Medicaid coverage for adults without children, officials said.

“On balance, it’s definitely a gain,” said JudyAnn Bigby, secretary of the Massachusetts Office of Health and Human Services.
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But even with more federal help, the challenge for states like Alabama, Arkansas and Texas that now offer only limited Medicaid coverage will be substantial. In these states, Medicaid has been mostly restricted to low-income families with children, pregnant women, certain people with disabilities and some elderly. The income cutoffs have also been extremely low.
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Texas, which has some of the most restrictive Medicaid eligibility rules in the country for adults, currently covers working parents only if they do not earn more than roughly 20 percent of the federal poverty level. The program does not cover childless adults.

Anne Dunkelberg, associate director of the Center for Public Policy Priorities, a research group in Austin that strongly supported the health care law, estimated that if the legislation went into effect today, an additional one million adults would qualify for Medicaid, at a cost of $370 million a year if Texas were to pay its full 10 percent share.

In addition, Ms. Dunkelberg said, many children who are currently eligible but are not enrolled in Medicaid and the state Children’s Health Insurance Program will emerge and want to join, potentially costing the state several hundred million dollars.

Some states, like Arizona, face an immediate fiscal conundrum because of stipulations in the law that prohibit them from rolling back their existing Medicaid programs before the required expansion takes effect.

About a decade ago, voters in Arizona approved a measure to expand Medicaid to include childless adults whose incomes were at or below the federal poverty limit. As part of an effort to close a $2.6 billion budget gap next year, state officials recently decided to end that program, along with the state’s Children’s Health Insurance Program. Gov. Jan Brewer, a Republican, signed the cuts into law last week.

Now, however, the state must come up with the money to restore the programs, estimated at a billion dollars annually.

Whew! I'll bet your eyes will glaze over attempting to read this excerpt. I just hope the idea is clear. If the state's are expected to expand their Medicaid coverage it will prove to be more of a headache. Especially if the idea is to provide coverage to more uninsured people.