Michigan Medicaid Program ‘Should Resemble Commercial Insurance’ to Cut Costs, Editorial Says

Michigan Gov.-elect Jennifer Granholm (D) must "fundamentally restructure [Medicaid] and move it toward a more consumer-driven system" to avoid a crisis in the program, according to a Detroit News editorial. The state's Medicaid program has become the state's "biggest budget guzzler" because of the "lure" of federal matching funds, which provide the state with 65 cents for every dollar it spends, an "incentive for the state to continuously bump up its Medicaid spending." Also, the program's enrollment has increased while the federal government "has closed off many loopholes that had previously allowed states to maximize their federal Medicaid dollars." The editorial said that "possibly the worst" way to remedy Medicaid's increasing costs would be to raise taxes. Instead, Granholm should "redefine the eligibility criteria for Medicaid so it is once again, as originally intended, a safety net for the truly needy." Because the federal government has required states to offer a "Cadillac health insurance package," the state cannot offer "even rudimentary incentives for cutting costs, such as higher copays and deductibles, something private employers have been doing for years," the News states. Medicaid "should resemble commercial insurance" and "buy umbrella private coverage for medical emergencies and acute health care problems -- not to pay for a full slew of benefits," the editorial concludes (Detroit News, 11/24). Granholm has said she would "vigorously oppose" a potential for-profit conversion of Blue Cross Blue Shield of Michigan because she believes such a move would "dramatically increase the number of uninsured." She has said she would also propose measures to expand access to Medicaid; MiChild, the state's CHIP program; and MiFamily, a state program for low-income adults who do not qualify for Medicaid and cannot afford private insurance, by making the enrollment process easier and "treat[ing] children in MiChild on the spot." She would also use a greater percentage of the state's share of the national tobacco settlement for health services (Kaiser Daily Health Policy Report, 11/6).