LTC Bullet: The Medicaid Moment to Save LTC
Friday, June 9, 2017
LTC Comment: Competition works in the free market; federalism works in the public sector. Put both to work fixing long-term care, after the ***news.***
*** THANKS TO Stephen D. Forman of Center-corporate-member LTC Associates for this tidbit: “Medicaid: If it were a carrier (what I call the Medicaid Insurance Company), its claim payments would dwarf our entire industry by a factor of 10:1 (approx. $120B vs $12B). But how much do you know about it? Take this quiz.” More evidence LTCI is David vs. Medicaid’s Goliath. ***
*** HERE’S THE LATEST from Claude Thau on the Big Sonia “non-Holocaust, Holocaust movie” we highlighted in a recent LTC Bullet:
“Big Sonia” has earned many awards in film festivals. At 8 p.m. Eastern time (7 CT, 6 MT, 5 PT), on Sunday June 11 and Monday June 12, you and your friends can meet "Big Sonia" producers Leah Warshawski (Sonia's grand-daughter) and Todd Soliday. I organized these free sessions so you can ask about "Big Sonia", producing and distributing movies, what they must do to qualify for an Academy Award nomination, how they helped Rwandan independent Hutu and Tutsi filmmakers come together to view each other's films, coping with transgenerational trauma (Leah did a TED talk on this topic recently), etc. This FREE event is part of their crowd-funding effort at https://www.womenyoushouldfund.com/projects/bringing-big-sonia-to-the-big-screen/.
At 8 pm Eastern on either/both June 11 and June 12, please call 712-432-0180 (password: 957803#) to hear the speakers (free if you have “free long distance”) and also click on the date-specific link below.
Click here to register for the “Big Sonia” WebEx Sunday,
June 11, at 8 pm Eastern (7 Central, 6 Mountain, 5 Pacific).
When you register, you can post the event to social media.
Every bit helps, so I’d appreciate your forwarding of this message to people who might be interested. Please encourage them to pass it on.
Payments through the crowd-funding site are NOT tax-deductible. To get a tax deduction, donate to Northwest Film Forum (the non-profit behind this project) either on-line through http://bigsonia.com/ or by contacting Christopher Day, Director of Operations; firstname.lastname@example.org; 206-329-2629. Their Tax ID is 91-1702331. If you plan to donate $5000 or more, you might call me to discuss the most effective approach.
Your crowd-funding commitment is a pledge, not a payment. If Leah & Todd don’t make their goal, your pledge is voided. That’s why I am so thankful not only for your potential pledge but also for passing this message on to other possibly interested parties.
Thanks and Best wishes!
LTC BULLET: THE MEDICAID MOMENT TO SAVE LTC
LTC Comment: Top down central planning doesn’t work. The Soviet Union, Cuba, and Venezuela proved that conclusively.
Yet, Medicaid is a top down program. Federal Pooh-Bahs tell states how to run the program, allow minimal flexibility, encourage overspending by matching as much as states care to spend, and then micro-manage in ways that prevent efficient operation. I know. I was a Medicaid State Representative for the Health Care Financing Administration in the 1980s. I conceived my job as helping Oregon operate a good program in spite of debilitating federal rules, regulations, and interference.
Just imagine what could happen if state Medicaid programs received federal funding less hamstrung by stultifying red tape. Fifty states would experiment with diverse approaches to service delivery, financing and eligibility. They’d compete to provide the most cost-effective services for recipients and tax payers. Our country’s Founders understood this, which is why they created a federal system in the Constitution leaving most responsibility and power with the people and the states.
As we explained in a recent LTC Bullet: Medicaid Matters Most, May 5, 2017, Medicaid isn’t just a factor in long-term care financing, it is the critical factor affecting everything. Medicaid is responsible for (1) institutional bias, (2) access and quality problems, (3) the shortage of private payers, (4) undeveloped private markets for home care and insurance, (5) inadequate caregiver supply, and so on. Fixing Medicaid is the leverage we need to fix long-term care.
Last Tuesday’s (June 6) Wall Street Journal contained an editorial titled The Senate’s Medicaid Moment. It illustrated how state Medicaid programs can make a big difference when they’re given even a modicum of elbow room to operate creatively. Here are some quotes from that piece followed by our comments.
WSJ: “Senate Republicans are struggling to agree on health reform, and the biggest divide concerns Medicaid. The problem is that too many seem to accept the liberal line that reform inevitably means kicking Americans off government coverage.”
LTC Comment: Just about everything we do and say at the Center for Long-Term Care Reform shows and proves that targeting Medicaid LTC benefits to the genuinely needy will improve care access and quality for everyone by creating stronger incentives for people to plan early, save, invest or insure for long-term care. So, giving states more authority to manage Medicaid LTC eligibility won’t kick people off Medicaid. It will prevent them from becoming dependent on government coverage in the first place.
WSJ: “The modern era of Medicaid reform began in 2007, when Governor Mitch Daniels signed the Healthy Indiana Plan that introduced consumer-directed insurance options, including Health Savings Accounts (HSAs).”
LTC Comment: The new Administrator of CMS, Seema Verma, was responsible for these Medicaid reforms in Indiana and she’s now ideally positioned to help other states experiment with all kinds of eligibility, service delivery and financing reforms . . . as soon as Congress and the President remove the handcuffs on state experimentation and creativity.
WSJ: “Rhode Island Governor Donald Carcieri applied for a Medicaid block grant that gives states a fixed sum of money in return for Washington’s regulatory forbearance. . . . Over the first three years, the Rhode Island waiver saved some $100 million in local funds and overall spending fell about $3 billion below the $12 billion cap. The fixed federal spending limit encouraged the state to innovate, such as reducing hospital admissions for chronic diseases or transitioning the frail elderly to community care from nursing homes.”
LTC Comment: This is the classic example of what can happen when states receive a set amount of federal funding with fewer strings attached. We published reports highlighting the potential of Rhode Island’s unique global waiver to improve Medicaid long-term care: Doing LTC RIght (2010) and The Age Wave, the Ocean State, and Long-Term Care (2009).
WSJ: “Block grants are now even routine in none other than Andrew Cuomo’s New York. After a scandal where federal investigators concluded the state had systematically manipulated Medicaid payment formulas to generate federal payola for more than two decades, the Democratic Governor agreed in 2014 to a waiver that caps ‘global’ spending at the growth rate of long-term health-care inflation (3.6%).”
LTC Comment: For more on the scandal that had this result, see “LTC Bullet: Bipartisan Congressional Blast at New York Medicaid,” February 22, 2013.
WSJ: “This reform honor roll could continue: the 21 states that have moved more than 75% of all beneficiaries to managed care, Colorado’s pediatric ‘medical homes’ program, Texas’s Medicaid waiver to devolve control to localities from the Austin bureaucracy. But liberals and the media ignore this progress as they try to frighten the GOP into doing nothing.”
LTC Comment: I hate to see these issues cast in political, especially ideological, terms. There is an objective reality independent of philosophical opinions. Competition and federalism work. Central planning doesn’t. Let’s try the former for once and see what happens.
WSJ: “[S]ome 600,000 Americans with disabilities, brain injuries and mental illness are now in purgatory on state Medicaid waiting lists, and they compete with new Medicaid’s [i.e., ObamaCare’s] able-bodied adults for scarce resources. Better to prioritize the truly needy while promoting other goals like health outcomes or labor force attachment.” [Emphasis added.]
LTC Comment: Hear, hear! It’s about time someone, besides us, recognized that the current system hurts the truly needy most.
WSJ: “The political reality is that Republicans won’t get a better chance to reform an entitlement if they muff this one. ObamaCare is imploding, with Anthem saying Tuesday it will leave 18 counties in Ohio next year. Senate Republicans need to settle their differences or prepare to get run out of town.”
LTC Comment: One way Republicans could enhance their chances would be to focus more on the long-term care side of Medicaid (where most of the money is) and less on the acute care side (where most of the recipients are.) It is a potentially advantageous fact that spending less for Medicaid LTC, but spending it on those most in need could save billions. See our reports: Save Medicaid LTC $30 Billion Per Year AND Improve the Program (2011) and “Briefing Paper #5: Dual Eligibles and Long-Term Care: How to Save Medicaid LTC $30 Billion Per Year and Pay for the ‘Doc Fix’" www.centerltc.com/BriefingPapers/5.htm (2012).
Bottom line, Medicaid long-term care cannot go on indefinitely as it is. The program is unsustainable and will hit a fiscal wall around 2031 when boomers start turning 85 and Social Security/Medicare have to cut back 25 percent or more. Scary as change may be, block grants are a cake walk compared to the inevitable future without them.