Michigan hospitals and physicians are criticizing the fiscal 2011 budget request unveiled by Gov. Jennifer Granholm, which would maintain an 8% cut to Medicaid reimbursement rates implemented in the current budget and create a new assessment on physicians to help the state cover its Medicaid costs.
Mich. hospitals, docs criticized proposed state budget
“These cuts will ultimately threaten healthcare access, not only for the Medicaid and uninsured populations, but for all Michiganians who rely on Michigan hospitals,” Michigan Health & Hospital Association President Spencer Johnson said in a written statement.
Granholm is seeking to address a structural shortfall of about $1.5 billion for the fiscal year that begins Oct. 1. State revenue has fallen precipitously with the state suffering an economic downturn longer and deeper than the one hitting the country at large. Inflation-adjusted revenue has fallen 41% since 2002 and now roughly equals what the state collected in 1965, according to the budget blueprint.
A proposed physician assessment is described as allowing the state to increase Medicaid payments to physicians by 80% while bringing home additional federal dollars and saving $133 million for the state's general fund. The Michigan State Medical Society, however, quickly issued a news release reiterating its vigorous opposition to the idea, which has been proposed before. “This budget proposal rehashes the old, failed proposals that would increase the cost of doing business in Michigan and drive people away to find opportunities in other states,” said Richard Smith, president of the Michigan medical society, in the release.
The budget request also calls for the creation of an Office of Health Services Inspector General to chase Medicaid fraud and abuse. It also asks for an end to a state law shielding drug manufacturers from product liability and for a portion of settlements in lawsuits brought by Medicaid beneficiaries to offset Medicaid costs.
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