Let the slippery slope begin - States can cut back on Medicaid payments

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A recent article in the New York Times is a disturbing harbinger of things to come. The Obama administration has given the green light to states to cut Medicaid payments to doctors and other health care providers to help contain costs. Kathleen Sebelius, the secretary of health and human services, approved the cuts in October 2011 after finding that beneficiaries would still have “adequate access” to the wide range of services covered by Medicaid. Okay, hang on... we want to expand Medicaid - that's a good thing, right? But then we also want to cut costs to help contain the cost of expansion. So who wins and who loses in this scenario? Kids and families, that's who.

In the Times article, Governor Jerry Brown of California is quoted as saying that the Medicaid cuts were essential to his efforts to deal with state budget deficit.

Also quoted in the Times article is Dr. Paul R. Phinney, president of the California Medical Association, who said:
  • “Two-thirds of doctors in California cannot afford to participate in Medicaid because the rates are so low. The problem will only get worse if rates are cut as we move more and more people into Medicaid.”

And therein lies the rub... What about the people who benefit from Medicaid? You know, the approximately 60 million low-income people whose numbers are soon to be increased with the new health care law. What happens to them?

Hence the slippery slope. Cut costs, cut rates, definitely cut quality for traditional services. If you doubt it, take a look at the Bickman opinion article we recently posted, which describes a study that shows what many mental health administrators already know - the quality of traditional mental health care is just not that good. The problem is that traditional mental health care is one of the key Medicaid reimbursements for providers serving children with serious emotional challenges and their families.

Cutting rates to help reign in costs is something we need to watch very closely.


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