Medicaid reform may be a long time coming

States fend for themselves while Congress debates whether and how to change the troubled public program.

By Joel B. Finkelstein, AMNews staff. April 7, 2003.

Washington -- There is little agreement on Capitol Hill about how to alleviate the current funding problems in state Medicaid programs. This is partly because there is little agreement on what, exactly, the problem is.

Despite a healthy mix of research and speculation, no single combination of factors has been isolated as the cause of Medicaid programs' woes.

Patient advocates say the federal government is asking the programs to do too much with too few resources. The Bush administration says the states need to run their programs more efficiently. Economists blame a poor economy and lost tax revenues in the states.

Meanwhile, states are being forced to take actions to avert projected budget shortfalls. Virtually all have already made or are planning to make cuts in payments to doctors and others, in services, and in eligibility.

Mainly out of desperation, many states say they are willing to try anything, and they have backed that up with record numbers of requests for federal waivers to allow them to try potentially money-saving approaches to administering their programs.

Democratic governors recently lobbied White House officials and congressional lawmakers for an increase in matching funds, at least for the short term, until the states can stabilize their budgets.

Several bills have been offered in Congress to provide the states billions of dollars, in what is acknowledged to be only a Band-Aid for the current crisis.