Vol. 75/No. 7      February 21, 2011

Well before those projections are supposed to kick in, state governments, with White House help, are looking to cut Medicaid services, leaving many working people with little more than emergency care. Budgets are being balanced on the back of working people. Medicaid funding is shared by state and federal governments.

A February 3 letter from U.S. health secretary Kathleen Sebelius advises state governors on how to save money by restricting services for those covered under Medicaid. Services and eligibility vary state by state. Arizona governor Janice Brewer is asking for federal authorization to cut 280,000 adults from the programs.

“Enrollment in Medicaid climbed by 7 percent due to the recession,” Obama’s health secretary writes, while state Medicaid spending dropped by 10 percent. More than 50 million people, including 25 percent of children, are enrolled in Medicaid programs.

Instead of immediately forcing large numbers of people off the Medicaid rolls—which Sebelius does not rule out—she encourages the governors to look first at exercising “flexibility” in how the program is implemented.

Sebelius emphasizes that state governments don’t need federal permission to cut back or entirely eliminate many basic services, such as prescription drugs, dental services, and speech therapy. Among the other “optional” health services are physical therapy, respiratory care, kidney dialysis, artificial limbs, wheelchairs, optometry, and eyeglasses.

She also reminds the governors that they can unilaterally raise patient fees for doctor visits and prescriptions, which she calls “cost sharing.” Many states have already implemented these cuts.

Sebelius encourages the governors to look for ways to reduce payments for the sickest patients. “Just 1 percent of all Medicaid beneficiaries account for 25 percent of all expenditures,” Sebelius writes. She promises to “expedite review of state proposals” for cuts that require federal approval.

While more working people—battered by layoffs, long-term unemployment, and stagnant or declining wages—are turning to Medicaid for medical care, they are also signing up for food stamps to make ends meet.

Just-released figures show that in November 43.6 million people—more than 14 percent of the U.S. population—used food stamps to purchase groceries, a 14.2 percent increase from last year. The percentage was highest in Mississippi, and Washington, D.C., where one in five people are in the program.

Many of those receiving food stamps are full-time workers. Like Medicaid, eligibility and amounts disbursed vary state by state. In North Carolina, couples get the equivalent of $12 a day; families get $18 to $26, based on the number of children.

More working people are also turning to food banks to supplement what they can buy. In Arizona food distributed by the banks, run by charities, increased 27 percent from 2009 to 2010.

Global food costs jumped 25 percent last year, while in the United States retail food costs rose 1.5 percent.
 
 
Related articles:
Economic recovery is little help for workers
California governor aims to slash social programs  
 
 
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