Healthcare Business News

Need for Medicaid flexibility stressed

By Rich Daly
Posted: March 1, 2011 - 1:00 pm ET

Allowing states more flexibility in managing their Medicaid programs is needed to avoid future costs that will dwarf current budget struggles, according to Republican governors and members of Congress.

Those concerns stemmed from new estimates that the future costs of Medicaid requirements in the Patient Protection and Affordable Care Act will double beyond previous estimates. Republicans on the Senate Finance Committee and the House Energy and Commerce Committee estimated Tuesday that the Medicaid expansion, which is mostly funded by the federal government, still would cost states $118 billion in the first 10 years.

“This will require a gigantic increase in our taxes,” Mississippi Gov. Haley Barbour, a Republican, told the House panel Tuesday, about his state's estimated Medicaid cost increase of up to $1.7 billion during the first 10 years of the ACA.

Democratic Gov. Deval Patrick agreed that rising healthcare costs have become a leading concern in Massachusetts' near-universal insurance system on which much of the federal healthcare law was modeled.

Increasing cost concerns have fueled an emerging congressional battle over Republican plans to push for state block grants, which allow cuts in enrollment and benefits, and release from federal penalties for cutting enrollment.

“The flexibility that my Republican colleagues seek seems aimed more at destroying the Medicaid program than saving it,” Rep. Frank Pallone (D-N.J.) said.

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