[ThinkSouth] Privatizing Medicaid

[Warwick Sabin]

In Florida, the Bush administration is doing to Medicaid what it couldn't convince the American people to do to Social Security.

In the Florida experiment, instead of reimbursing doctors and hospitals for treating Medicaid patients, the state received the Bush administration's permission to pay a fixed amount to HMOs to provide for each person's coverage, with private insurers determining care based on each beneficiary's allotted funds.

About 45 million Americans already lack health insurance -- an appalling figure for the richest country in the world. If the Florida approach to Medicaid expands elsewhere, millions more of our most vulnerable citizens may have to get by with less coverage.

Medicaid and its sister program, Medicare, provide health insurance for about 80 million people nationwide. Republicans in the U.S. Senate unveiled legislation Thursday that would cut spending for the two programs by $10 billion.

"More and more people are going without coverage or with less coverage, and that trend looks like it's going to continue," said Henry Aaron, senior fellow at Washington's Brookings Institution.

"It seems grotesque for officials to argue the unaffordability of Medicaid as we make tax changes that disproportionately benefit the wealthy," he said.

Yet that's precisely the argument Florida Gov. Jeb Bush -- the president's brother -- made Wednesday after announcing that he'd received a green light from the administration to shift thousands of Medicaid patients into HMOs and to cap the amount spent on each beneficiary.

"I think this will be part of a national debate about how to create a more sustainable Medicaid program," Gov. Bush told reporters in Washington . . . .

"What happens when a private HMO won't cover a Medicaid patient's expenses?" asked Bentley Lipscomb, Florida director of AARP. "Where's the proof this will actually save state tax dollars?"

Could this happen in other Southern states?

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Posted by Warwick Sabin to ThinkSouth at 10/26/2005 11:09:00 AM