Well gang, it’s that special time of the year when the president delivers a wish-list budget that gives red meat to the base — and heartburn to just about everyone else.
Particularly worrisome in the spending package released Monday is a proposal to institute block grants as a way to manage and reduce future Medicaid outlays. Fortunately, it does not appear the proposal will pass – this time.
But senior living operators should take notice whenever Medicaid cuts, block grants and more state authority are proposed in the same sentence.
Why be alarmed by Medicaid cuts? Well, simply put, fewer Medicaid dollars means fewer payments for services your community might deliver. In my experience, operators do not generally see reduced funding as a good development. From a more altruistic, big-picture perspective, the shift would mean more low- and no-income people who need care would be out of luck.
Which brings us to why block grants are probably not going to do your community any favors. Perhaps Families USA has delivered the best critique of the concept. Here are three specific problems they cite:
- Should a state’s costs exceed the amount of the block grant, it will have to use its own funds to make up the difference or, more likely, cut services.
- Counter to what proponents claim, block grants don’t give states more flexibility with their Medicaid programs.
- Block grants would make it harder for states to serve their residents’ healthcare needs.
For a more detailed analysis, please go here.
Which brings us to the matter of giving state lawmakers more sway. Let me put my concern here as bluntly as possible. These ladies and gentlemen have shown time and time again they are not to be trusted.
Here in my home state of Illinois, we are wrestling with a $100 billion pension shortfall. To be sure, the crisis can be blamed in part to dubious dealmaking between unions and state lawmakers that are coming home to roost. But the larger issue is this: The state legislature repeatedly has refused to hold up its end of an agreed-on funding deal, while a succession of governors let them off the hook.
Does the Land of Lincoln have a funding crisis? Yes, in exactly the same way that a person who shoots himself in the foot has a pain crisis. In both cases, the problem easily could have and should have been avoided.
But why just pick on Illinois?
In 1998, Big Tobacco entered into an extraordinary deal with almost every state. Under this master settlement agreement, cigarette manufacturers forever would make payments to state governments, largely to fund anti-smoking campaigns. This should have been a great way for states to deal with our nation’s smoking epidemic.
But what did state lawmakers do with the money? Pretty much whatever they wanted to. Among the alleged smoking-reduction efforts so far: building shipping docks in Alaska and constructing a county building in New York. But North Carolina set the chutzpah bar highest of all. They decided to give tobacco farmers $42 million for marketing and “modernization.”
These are the best people to decide how future Medicaid dollars should be allocated? I don’t think so.