LTC Bullet:  Medicaid Woes Worsen

March 7, 2002


*** Attention all Zoners:  here's the "LTC Week in Review" content we'll be adding to the Center's Donor-Only Zone on Monday:  "Boomers in Retirement," "Rats Discover Fountain of Youth," "New Edition of LTC Planning Guide," "How to Reverse Memory Loss," and "Medicaid Home Reduced to Begging for Private Charity." ***

*** The Center's first two LTC Graduate Seminars, conducted in Chicago March 4 and 5, were a big success.  One participant asked her husband for the enrollment fee as an anniversary present (in lieu of "a nice piece of jewelry") and was glad she did.  Another spent his "double-nickel" birthday (55) at the program and commented "Your thorough explanation of the Medicare/Medicaid crisis was extremely informative."  A third indicated "I would recommend your seminar to anyone who is passionate about marketing LTCI to their clients and wants to get a better understanding of the big picture."  Watch for an LTC Graduate Seminar in your area.  Were coming to Pittsburgh and Philadelphia and probably New Orleans and Sacramento in May.  Details to follow in a future LTC Bullet.  If you're interested in locking in a reservation, email and let her know.  Remember, these are small group seminars and they will fill fast! ***

The LA Times recently reported that states around the country are continuing to cut Medicaid funding and services in response to mounting budget pressures.  In many instances, these cuts affect long-term care recipients.  The Center for LTC Financing has implored states to consider new public policy to divert most people away from taxpayer-financed care in order to save our scarce public dollars for the truly needy.  With rational public policy in place, most people will save, invest, or insure for long-term care.  The Center's "LTC Choice" framework for public policy reform is set forth in the Center's white paper "LTC Choice:  A Simple, Cost-Free Solution to the Long-Term Care Financing Puzzle" (online in .pdf format at  However, unless and until states accept the futility of current public policy (which has resulted in massive over-utilization of our public safety-net programs), more cuts that could jeopardize access and quality of care for Medicaid recipients are likely on the way.

Below are a few quotes from the LA Times article "Medicaid Ax is Falling as Recession Saps States"  (3/5/02, online at  We encourage you to read the entire article to appreciate the enormity of the crisis.  Examples of actual or proposed Medicaid cuts are given for Vermont, Florida, Illinois, Missouri, California, Utah, and Arkansas.

"Their budgets squeezed tight by recession, lawmakers in state after state have had enough.  They are moving to cut some people off Medicaid insurance and to trim benefits for those who remain."

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"At their annual meeting last week, the nation's governors were unanimous in declaring Medicaid's cost the most urgent crisis they face.  Just how grave the problem is became clear Friday, when Mississippi's Medicaid program went broke.  Lawmakers there were unable to come up with the money to pay for medical care for the poor."

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"The prospect [of lower Medicaid reimbursement] does not so much enrage nursing home owner Steven Wolf as it leaves him speechless.  Already, he says, he is losing more than $20 a day on each of the 115 or so Medicaid patients at his Calvin Johnson Care Center--a worn but cheery nursing home in Belleville, a blue-collar suburb of St. Louis.

"The medical staff and the housekeepers, the liver lunches and the scrambled eggs on request, the balloon volleyball games, the pet therapy, the concerts of patriotic music--it all costs him close to $107 per patient per day.  Medicaid pays him $86.   And the governor has proposed slashing that by nearly 9%."

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"'It's just impossible,' concludes Anne Swerlick, an attorney at Florida Legal Services, which works on behalf of low-income people.

"But state lawmakers and Medicaid administrators throw the same phrase right back at their critics.  It's not possible, they say, for Medicaid to do so much for so many.  Not if there is to be money left over to improve schools and fix highways and protect children from abuse, to lower taxes and build parks.  Not in this economy."

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