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Federal Perspective Changes in Medicaid Alice Burton, Director AcademyHealth June 2, 2005

Explore the potential changes in Medicaid and SCHIP programs at the federal level, including budget reductions, the creation of a Medicaid Commission, and proposed sources of savings. Learn about the next steps in the federal budget process and the states' proposed changes to Medicaid.

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Federal Perspective Changes in Medicaid Alice Burton, Director AcademyHealth June 2, 2005

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  1. Federal Perspective Changes in Medicaid Alice Burton, Director AcademyHealth June 2, 2005

  2. Medicaid & SCHIP – Federal Changes • Budget resolution calls for $10 billion in Medicaid reductions over 5 years • Budget Resolution is broad budget framework • Final Medicaid reductions might be more or less than $10 billion • Medicaid Commission created • SCHIP Reauthorization due by 2008, maybe sooner

  3. Medicaid Commission • “To advise Secretary on ways to modernize Medicaid the Medicaid program so it can provide high quality health care to its beneficiaries in a financially sustainable way” (CMS Charter, 5/19/05) • By Sept 1 2005 – recommendations on $10 billion in savings over 5 years • By Dec. 31 2006 – Longer-term recommendations that ensure sustainability

  4. Potential Sources of Medicaid Savings • President’s budget savings proposals totaled $13.9 billion over 5 years (CBO scoring) • Provider taxes $5.7 billion • Rx pricing $5.2 billion (some Govs support) • Asset transfer $1.4 billion (some Govs support) • Targeted case management $1.5 billion • Gov Warner letter with suggested savings: Rx pricing, asset transfer and $2 billion by allowing states to charge higher co-pays

  5. Next Steps in Federal Budget Process • Commission report – September 1, 2005 • House and Senate Committee action • Response to reconciliation instructions expected by September 15, 2005 • Appropriations bills separate • FY 2006 starts October 1st

  6. States Propose Changes to Medicaid • Reductions in Eligibility: • Tennessee & Missouri • Concept papers or waivers to “redesign” including individual accounts • Florida, Georgia, Vermont, West Virginia, New Hampshire • Changes to Disproportionate Share Funding and other financing issues

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