Kentucky, Iowa Legislators Consider Cuts to Reduce Medicaid Shortfalls
Kentucky legislators are considering cuts to Medicaid as a way to cover the state's "multi-million dollar" budget deficit, the Lexington Herald-Leader reports. While the state was able to "fend off" cuts to the program in the 1990s despite increasing costs and enrollment, Gov. Paul Patton (D) said "those days are over," adding, "We can't pull any more rabbits out of that hat. If Medicaid is flat-funded, there will be cuts in Medicaid eligibility and services. There appears no way around that in the future." Legislators are considering several budget-reducing measures, including:
- A bill to create a "pharmacy and therapeutic committee" to advise the governor and the Cabinet for Health Services on prescription drugs. The panel would also be tasked with establishing a drug formulary for Medicaid.
- A measure to "freeze" the dispensing fee paid to pharmacists until the end of fiscal year 2003-2004 or until a study on the fee was completed. The fee is scheduled to increase from $4.51 to $5.88 this month.
- Introducing copayments for some Medicaid services. Under federal law, such fees may range from 50 cents to $3, but inpatients, pregnant women, children under 18 and those requiring emergency care are exempt from copayments.
- Legislation to improve the organization of the Cabinet for Health Services, which has been criticized as "dysfunctional" (Richardson, Lexington Herald-Leader, 1/6).
Iowa's $25M Medicaid Shortfall
Meanwhile, as Iowa's Medicaid program faces a $25 million shortfall and the state Department of Human Services must cut $18.6 million from the program to comply with a 4.3% across-the-board budget reduction, Gov. Tom Vilsack (D) and Republican legislative leaders are trying to "bridge their differences" on how to cover the program's expenses, the Des Moines Register reports. A task force of legislators and administration officials has recommended "cut[ting] off" services for about 4,000 beneficiaries with incomes "just above" the poverty line, but Vilsack opposes such a move. Instead of cutting Medicaid services or eligibility, he favors using funds from elsewhere in the state budget, including a trust fund for senior care and the state's tobacco settlement, to boost program finances. Republican legislators, however, are not "receptive" to using funds from the tobacco settlement, which have been earmarked for tobacco prevention and other health care services (Okamoto, Des Moines Register, 1/7).
