LTC Bullet:  Medicaid Flunks, So What Now? 

Thursday, April 26, 2007 


LTC Comment:  "Public Citizen" reviewed state Medicaid programs and found that none excel, most fail abjectly.  So what now?  After the ***news.*** 

*** LTC COMPACT STUDY.  This project is moving forward.  For details, see "LTC Bullet:  LTC Compact Study Proposal," Thursday, April 19, 2007 at  I'll be doing the documentary and internet research next week, conducting the field interviews May 7-11 in Albany, New York, and writing the report the following week for publication by the end of May.  If you have any information such as letters, emails, white papers, journal articles, etc. that you believe should be reviewed for this study, please forward them to Steve Moses at or fax (if under 10 pages) to 206-283-6536.  Likewise, please send recommendations and contact information for people you think we should interview. *** 

*** TERRY SAVAGE WEBCAST.  Make it a point to check out this webcast on retirement and long-term care planning by the nationally syndicated columnist and strong Center for Long-Term Care Reform supporter:  While you're at it, read the transcript of the live chat that followed the webcast.  I asked "Q:  smoses of Seattle:  Terry:  What do you tell people who say 'I know an attorney who says he can get me the same LTC without spending my own money?'  After paying his billable hours, of course."  She answered:  "A:  Terry Savage - Am I allowed to say BS?!  If not, delete this answer (editors!)" *** 

*** BONUS WEBSITE.  All you have to do to have your very own LTC website designed by LTC Connection is to join the Center for Long-Term Care Reform.  That's right, join the Center for $150 per year, get all our publications and access to The Zone, including our new "Almanac of Long-Term Care," and on top of that LTC Connection will design your website and waive their usual $149 fee.  Or look at it this way, buy your website from LTC Connection through the Center and get a year of membership in the Center for only $1 more.  Sure, you'll have to pay LTC Connection's $39 per month website maintenance fee, but you'll get a whole year of LTC Bullets and LTC E-Alerts for no extra charge.  So, what do you have to do?  Just contact Damon at 206-283-7036 or, join the Center, pay your membership fee, and say "I want my website."  We'll connect you with the right person at LTC Connection and you'll be on your way.  Great content from the Center and a great website from LTC Connection.  How can you beat it?  Already a member of the Center but want your free website?  No problem.  Renew your annual membership early and get the same deal. ***



LTC Comment:  "Public Citizen is a national, nonprofit consumer advocacy organization founded in 1971 to represent consumer interests in Congress, the executive branch and the courts," according to its website at  

Last week Public Citizen published a report card on state Medicaid programs.  Any schoolchild bringing home a similarly negative report would be immediately grounded. 

Following are some excerpts from "Unsettling Scores:  A Ranking of State Medicaid Programs" by Annette B. Ramírez de Arellano, DrPH and Sidney M. Wolfe, MD, Public Citizen Health Research Group, April 2007;   

After the excerpts, read our "LTC Comment" on how this information is likely to be interpreted versus what it really means. 


Excerpts from "Unsettling Scores" 

"Enacted over 40 years ago, Medicaid has evolved with changing demographic, technological, and health needs; political priorities; and fiscal realities. The program has been called many things: the cornerstone of the nation's health system, a safety net for the neediest, a workhorse that goes into action when help is needed, and an inflexible and flawed system, among others. 

"Whatever its shortcomings, Medicaid continues to grow, reflecting and refracting many of the trends affecting health care as a whole. At present, the program • covers approximately 55 million Americans; • accounts for one out of every five health care dollars spent in the nation; • pays for 41 percent of all U.S. births and 50 percent of all long-term care costs; • supports tens of thousands of health care providers throughout the country; and • represents the largest source of federal grant support to states. . . . 

"Major Findings 

"Nationally, the state Medicaid programs are severely challenged: even the best state scores only 645.9 points on a scale of 1000. And the worst state rates a score of only 317.8, i.e., less than a third of the total maximum points. 

"The state-by-state breakdowns reveal marked disparities between and among states. The top 10 states, ranking #1 to #10, tend to cluster in the Northeast but also include three states in the Midwest and two in the Northwest. The following states occupy the first 10 ranks, in descending order: Massachusetts, Nebraska, Vermont, Alaska, Wisconsin, Rhode Island, Minnesota, New York, Washington, and New Hampshire. 

"The 10 most deficient state programs have overall scores ranging from between 317.8 and 379.1 of the total 1000 points. The worst, in order from 50th to 41st, are in Mississippi, Idaho, Texas, Oklahoma, South Dakota, Indiana, South Carolina, Colorado, Alabama, and Missouri. 

"The overall score of top-ranked Massachusetts is more than twice that of bottom-ranked Mississippi. A breakdown of scores by category further highlights the existing disparities: the scores vary 2.5-fold for scope of services, and more than threefold for eligibility. In the remaining two categories, which have fewer indicators and are therefore more volatile, variations among states are even more dramatic: in quality of care, the difference is more than 17-fold; in reimbursement, it is more than 20-fold. . . . 

"In summary, this evaluation of Medicaid demonstrates a bleak picture for millions of people in many states. 

"Overall, and in many ways, Medicaid is failing to deliver care to millions of people desperately in need of good quality health services. . . . 


"We have titled our report Unsettling Scores because it is indeed disturbing that, after more than four decades, the Medicaid program has clearly failed to achieve its objectives and to therefore fully meet the needs of those it serves or is supposed to serve. 

"Our findings make it clear that there are large numbers of people who need to be, but are not, eligible; need to have access to a wider scope of services; need to benefit from better quality health care; or need to have access to more providers than are available because state reimbursement policies make their participation difficult if not impossible. Yet these critically needed additions are 'voluntary' on the part of states rather than mandated nationally. The fact that many states have chosen to go beyond the federal legal requirements suggests that they are responding to constituent needs and public pressures, and that the 'floor' of mandated Medicaid coverage is clearly inadequate. Because the federal requirements are so lacking, if someone happens to live in the 'wrong' state-one that does not provide optimally in all four of these categories-they will be denied needed care. 

"No state could be described as having an excellent Medicaid program, as the highest-ranking state earned only 64.6 percent of the total points. In addition, the median or midpoint in the range of scores was 47.1 percent of the total. And 30 states, including some of the largest in the country, were among the 10 lowest-ranking states in one or more of the four categories we examined." 


LTC Comment:  Now, what meaning will be given to this study and its findings?  What actions will be proposed?  I'm going to go out on a limb here and take a wild guess.  If Medicaid is a such dismal failure, obviously what we need is a universal social insurance program that covers everyone.  That's exactly the kind of twisted logic that advocates of publicly financed health and long-term care use. 

What is a more reasonable conclusion?  If Medicaid is such a disaster, maybe it is because, not in spite of, government financing.  Perhaps Medicaid did too much for too many for too long--for example, paying for 4 of 10 births and two-thirds of nursing home residents since 1965--so that private health and LTC financing alternatives of all kinds, not to mention the more desirable service modalities like home care that people would buy if they were spending their own or their insurance carrier's money, have been crowded out of the marketplace. 

In other words:  if what Public Citizen really wants is a government takeover of health and long-term care financing, then the advocacy group may have taken careful aim at Medicaid, but it shot itself in the foot. 

The lesson for LTC insurance producers and reverse mortgage lenders to learn is this:  ending up on Medicaid is not an acceptable outcome, no matter what the Medicaid estate planning bar says to the contrary.  So tell your clients to save, invest and insure so they can pay privately if and when they need expensive long-term care someday.  At the rate it's going, Medicaid probably won't be around to help in the future even with the deficient services it provides today.