Medicaid bailout faces vote
(2/22/02 Clarion Ledger, MS) By Patrice Sawyer

The state House and Senate are expected to vote on a bill today to bail Medicaid out of its budget woes.

Negotiators reached a consensus late Thursday afternoon after working out differences over whether to curtail some services and reduce reimbursements to doctors and pharmacies or to apply across-the-board fees to the providers. The compromise favors the cuts and reductions.

Lawmakers are trying to beat a deadline to shore up the federal-state program by next week, when it is expected to run out of state funds. The program that serves about 650,000 needy, elderly and disabled Mississippians has a $158 million shortfall.

Gov. Ronnie Musgrove has not said what he will do when House Bill 1200 lands on his desk. Lawmakers have rejected his health-care proposal and he opposes cuts and reductions in the program.

Though they signed off on the compromise, House negotiators maintain the fee proposal would bring more money to Medicaid because it could be used in a 3-to-1, federal-to-state match, but cuts would drain money from the program.

Rep. Steve Holland, D-Plantersville, said cuts weren't enough to curb escalating Medicaid costs. During a meeting Thursday morning between House and Senate negotiators, Holland warned the Medicaid program, projected to have a much higher deficit in the next fiscal year, was headed for disaster.

"The headline needs to read tomorrow 'Major train wreck coming soon. Stay tuned'," he said.

House members wanted to levy $75 million in assessments to reap a 3-to-1 federal match of $225 million. The proposed cuts include a 5 percent reduction for doctors and would save the state $60 million over a year.

House Public Health and Welfare Committee Chairman Bobby Moody said the cuts would cost the state $180 million in federal funds.

The main sticking point for Senate negotiators on the House plan for assessments was a $1 fee on prescription drugs.

"I think we all like the idea of creating new revenue to draw down more matching money, the problem is fairness," said Senate President Pro Tempore Travis Little, D-Corinth, one of the negotiators. "It's going to penalize the pharmacists whose good majority of business is going to be Medicaid."

Since senators didn't agree to the assessments, the conference committee members decided to go back to House Bill 1200 as it passed that chamber, with some changes. In conference, three House members and three senators work out a final compromise.

The one assessment remaining in the bill is a $1 increase on nursing home beds, from $2 to $3. Nursing homes wouldn't be subject to the 5 percent provider cut.

Chris Plumlee, administrator of Compere's Nursing Home in Jackson, said he would rather have the fee raised than face a 5 percent cut. He agreed with House negotiators that an assessment would draw down more federal dollars instead of taking them away.

"So be it, if that's what they want to do. I do wish they would spread it out on all providers because we're not the only ones benefitting from Medicaid," he said.

House Bill 1200 includes reductions such as changing the number of maximum prescriptions per month per Medicaid recipient from 10 to seven. Recipients would pay $3 instead of the current $1 for each prescription.

The bill also provides for one pair of eyeglasses for recipients every five years instead of every three years. The Medicaid division would reimburse only for prescriptions that are 34-day supplies based on daily dosage.

Also, the pharmacists' dispensing fee would go from $4. 91 to $3. 91.

Other changes to the bill included an open meetings requirement for a Medicaid advisory committee that would deal with pharmaceutical companies to negotiate a preferred drug list.

House Bill 1200 also uses money the state obtained from settling a landmark lawsuit with the tobacco industry. It calls for $87 million to be used from the principal of the Health Care Trust Fund this year and $21 million from the Health Care Expendable Fund. Next year's tobacco payment, about $144 million, also will be used for the deficit. The money is to be repaid during better economic times.

Holland said Thursday lawmakers won't be able to use all of the $144 million for the next fiscal year because of other budgetary commitments for health care.

Medicaid is looking at a $238 million shortfall for fiscal 2003, he said.

Senate Public Health and Welfare Chairman Bunky Huggins, R-Greenwood, said the legislation is a short-term fix for a long-term problem.

"It's going to be a fight to find the money," he said.