New Medicaid Regulations To Reduce Health Care Cost

"It'shard to imagine a worse time to cut billions in federal Medicaid spending, butthat's what the Bush administration is doing" with the implementation ofseven new regulations, a Baltimore Sun editorial states (Baltimore Sun, 5/2). Under theregulations, states could not use federal Medicaid funds to help pay forphysician training. The regulations also would place new limits on Medicaidreimbursements to hospitals and nursing homes operated by state and localgovernments and limit coverage of rehabilitation services for individuals withdisabilities and mental illnesses (KaiserDaily Health Policy Report, 4/30).

According to the editorial, Bush administration officials maintain that therules are "necessary to close loopholes used by states" to increasethe amount of federal Medicaid funds they receive, but state officials"say any loopholes could have been closed without using what they call asledgehammer approach." The editorial states, "Let's face it: TheBush administration is using the changes in a backdoor effort to contain themounting costs of providing basic medical care for the poor."

A "bipartisan, veto-proof majority in the House has already passed" abill (HR 5613) that would delay implementation of the regulations for one year,and the Senate "should do the same," according to the editorial.However, President Bush has threatened to veto the legislation, and"Republican leaders in the Senate are siding with him," the editorialstates. The editorial states that "it would be penny wise and poundfoolish to cut healthy baby programs and outpatient and rehabilitation services,"adding that a reduction in funds in "those areas could lead to costlymedical emergencies that taxpayers will end up paying for" (Baltimore Sun,5/2).

Reprintedwith permission from kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, and sign upfor email delivery at kaisernetwork.org/email . The Kaiser Daily Health PolicyReport is published for kaisernetwork.org, a free service of The Henry J.Kaiser Family Foundation.