Medicaid, SCHIP Programs Should Have Adequate Funding During Economic Downturn

Armen Hareyan's picture

"Thetroubled economy could soon create a major fiscal crisis for the state-runMedicaid and children's health programs that would only be exacerbated by theBush administration's efforts to cut these programs back," a New York Times editorial states. The Timesnotes that a new analysis, from the Kaiser Family Foundation's Commission onMedicaid and Uninsured, conducted by the Urban Institute, projected that eachpercentage-point increase in the unemployment rate will increase Medicaid andSCHIP enrollment by one million people, and an additional 1.1 million wouldbecome uninsured as they lose employer-sponsored coverage.

As a result of the current "economic downturn," many states"will have little choice but to shrink their Medicaid and children'shealth programs," the Times writes, adding that at least 13states already have proposed reductions in the programs. According to the Times,the federal government provided states with $20 billion in fiscal relief duringthe last economic downturn, including $10 billion in increased matching fundsfor Medicaid. "But this time, the Bush administration has imposed newrules that would impede expansion of the children's health program and newregulations that would reduce federal funding for Medicaid by anywhere from $14billion (the administration's estimate) to $50 billion (the states' estimate)over the next five years," the Times writes.

The editorial states, "This is a terrible time to reduce funding for safety-netprograms," adding, "Congress needs to place a moratorium on theMedicaid regulations by a veto-proof margin and find a way to overturn thechildren's health rules," and it "should restructure Medicaid andchildren's health programs so that federal financing increases during badeconomic times -- when people most need their government's help" (NewYork Times, 5/1).

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