Healthcare Business News

Liberal Democrats rip proposed Medicaid cuts

By Rich Daly
Posted: December 11, 2012 - 2:00 pm ET

Leading liberals in Congress blasted separate Republican and Democratic proposals to cut Medicaid spending as part of an end-of-the-year deficit deal but remained open to unspecified Medicare cuts.

Republican proposals to restructure Medicaid from an open entitlement to a fixed-dollar block grant to states and a Democratic proposal to move it into a per-capita grant drew derision from senior Senate and House Democrats during a Tuesday news conference packed with boisterous healthcare union representatives.

“Both of these ideas are bad ideas because they limit the federal government's participation in making sure Medicaid will cover those who are most vulnerable,” said Rep. Henry Waxman (D-Calif.).

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Waxman and other Democrats also criticized a proposal by Republicans to pay for a one-year freeze in Medicare physician pay rates and put off a looming 26.5% cut. Republicans would pay for part of the "doc fix" by reversing a temporary boost in Medicaid payments to primary-care physicians that was included in the Patient Protection and Affordable Care Act. The one-year doc fix will cost $25.2 billion over 10 years, according to the Congressional Budget Office, while eliminating the primary-care pay increase will save $11 billion.

The offer by some liberal members of Congress to reduce Medicare spending was followed by their refusal to list specific cuts. Instead, they criticized cuts suggested by others, including reducing provider reimbursements.

Meanwhile, Republicans continued to push for any debt deal to include healthcare cuts. For example, Senate Minority Leader Mitch McConnell (Ky.) called for efforts to cut “billions” in waste from Medicaid as identified in a Monday report by the nonpartisan Government Accountability Office, which found that the same Medicaid claims are processed by both government officials and contractors.

The Medicaid focus on Capitol Hill came a day after the Obama administration announced the availability of full federal matching funds only to states that expand their Medicaid programs to cover everyone up to 133% of poverty, or as high as 138% of the federal poverty level, as laid out in the healthcare reform law.

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