Urban Institute Examines Recent Health Policies for Low-Income People in Mississippi and Washington State

The Urban Institute has released two reports describing the status of health care financing in Mississippi and Washington state, focusing on the states' Medicaid and CHIP programs. The reports, the first in a series of 13, are part the institute's Assessing the New Federalism program (Assessing the New Federalism release, 2/28). The following is a summary of each report's findings:

• Mississippi: Budgetary constraints "generally limit opportunities" to expand health programs in Mississippi, but the state "swift[ly]" utilized federal funding to start its CHIP program. The state has implemented two phases of the program -- a small Medicaid expansion and a private insurance option for low-income children. Implementation of the third phase of the CHIP program, subsidized insurance for higher-income groups, however, does not appear "imminent." As for the Medicaid program, Mississippi receives a federal funding match that is "the most favorable in the nation." Still, Mississippi "has difficultly generating" state funds for the program, a problem that is "expected to worsen" in the coming year. The state is using all its tobacco settlement money to fund health care initiatives, particularly its Medicaid and CHIP programs, according to the report. Looking to the future of Mississippi's programs, some state officials have proposed extending health insurance to parents of children in either CHIP or Medicaid (Ormond/Ullman, "Recent Changes in Health Policy for Low-Income People in Mississippi," February 2002). The report is available online.
• Washington: A "leader in health reform" since passing legislation expanding health coverage in 1993, Washington state is now "struggling to maintain" those advances. The 1993 legislation included a Medicaid expansion, a mandate that employers offer health insurance and a "major effort" to reform individual and small group insurance markets. Now costs are rising in many health-related areas; Medicaid spending is expected to increase by 11.6%, managed care spending by 11.5%, prescription drug spending by 17% and hospital and physician care spending by 10% per year between 2000 and 2003. Despite cost concerns, the state has expanded enrollment in its Medicaid program and now covers working people with disabilities and women with breast and cervical cancer. In addition, a ballot initiative passed in November 2001 to raise the state tobacco tax allowed the state to fund increased enrollment in its Basic Health Plan, an insurance program for low-income working families who do not qualify for Medicaid. Washington is "essentially solving its budget problems and avoiding health care cuts with one-time 'outside' revenues," the report notes (Holahan/Pohl, "Recent Changes in Health Policy for Low-Income People in Washington," February 2002). The report is available online.