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POLICY: Medicaid used as a way for the Feds to batter the states? with UPDATE Tues afternoon

While you may have thought that the New York Times was up on the news, the careful reader of THCB might have noticed that today’s story, titled U.S. Nears Clash With Governors on Medicaid Cost, shares exactly the theme of this post from Jones the Policy Wonk back in late December.

Both the NY Times and The Wonk believe that the Adminstration is gong to go after states that play games with their Medicaid accounting to increase Federal dollars into their Medicaid systems. The Wonk told us to pay attention to the appointment of Dennis Smith as CMS chief.  What was his quote in the NYT?

    "The Medicaid program must be a federal-state partnership, not an exercise in financial gamesmanship," said Dennis G. Smith, the top federal official for Medicaid.

Now I actually agree that there shouldn’t be these accounting shell games, but the states do this because they are desperately short of cash to deal with their responsibilities and unlike the Feds, they can’t go into deficits for as long as the eye can see (although Arnie is trying!). They’re already cutting Meidcaid services and SCHIP (500,000 kids off those rolls in California and 300,000 in Texas according to JeanneScott). Now there’s a chance that there might be substantially more cuts as Medicaid moves to a block grant system–the adminstration’s end-game.

So I’m all for ending these games. But instead we should either be properly funding health care for the poor and vulnerable, as Medicaid is intended to do, or admit that we don’t want to and just give up on the program–as we have for 43 million citizens already. Oh well, I suppose we have to cut off these loopholes and stop running up the deficit for those Medicaid-types so that there’s enough for vital programs like tax cuts on dividends, missile defense, raiding medical marujiana co-ops, invading Iraq, subsidizing millionaire cotton farmers, giving the airwaves to media corporations for free homeland security.

UPDATE: It appears that the noises from HHS & the White House are having the impact expected amongst the Republicans in Congress. Modern Healthcare reports late today that Tenet’s best friend Senator Grassley is on the case

    Senate Finance Committee Chairman Chuck Grassley (R-Iowa) has called for a federal probe into whether states’ use of consulting firms to increase federal Medicaid payments is leading to fraud and abuse. In a letter to HHS and the General Accounting Office, Grassley said investigations in Georgia and New Jersey may point to a national problem. HHS’ inspector general’s office is reviewing whether New Jersey inappropriately received some $41 million in Medicaid funds, while the CMS is examining an $84 million contract Georgia awarded to a consultant to maximize the state’s federal funding.

While Grassley may have a point about the consultants and the games they play, do you think he’d be quite so agressive if Medicaid was a subsidy program for rural hospitals that produced ethanol?

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