Noteworthy News

Medicaid at Risk in Fiscal Cliff Talks

If Medicaid is a health care program for at-risk low-income people, it appears that Medicaid itself is at risk during the current fiscal cliff talks in Washington, D.C.

While Medicaid was left untouched by last year’s sequestration bill, it is now viewed by growing numbers of policy-makers as a potential source of savings to help stave off the fiscal cliff.

Several aspects of Medicaid, in particular, appear to be vulnerable in the coming weeks.  They include the creation of a new “blended rate” – a single federal matching rate for both Medicaid and CHIP that could save the federal government nearly $15 billion in the coming years; Medicaid provider taxes, which are incurring growing opposition in Washington and which, if ratcheted back, could save more than $25 billion; supplemental payments for Medicaid primary care providers, scheduled to take effect on January 1, which if eliminated would save $13 billion; better management of dual eligibles, which could save $12 billion; and medical equipment spending, where a competitive bidding program similar to that currently being introduced for Medicare could save $5 billion.

Because they care for such large numbers of Medicaid beneficiaries, many of these cuts would be very harmful to the nation’s urban safety-net hospitals.

Learn more about how Medicaid figures in the current fiscal cliff talks and how policy-makers are increasingly looking to Medicaid for savings in this Politico articleUS Capitol Dome.

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