States Form "Loose Confederacy" to Lobby Against More Medicaid Cuts

Cash-strapped states are coming together, forming a "loose confederacy" to discourage the deficit reduction supercommittee from recommending any Medicaid cuts, according to a Reuters report.

As part of the Budget Control Act, a bipartisan Congressional committee has been charged with finding $1.2-1.5 trillion in savings by Thanksgiving. Failure to submit the recommended savings or failure by Congress to enact the recommendations by the end of the year will result in automatic cuts, including a 2 percent cut in Medicare payments.

States, many of which have had to tighten budgets and cut costs due to significant shortfalls, have taken issue with two proposals President Obama submitted to the supercommittee last week. One would reduce federal matching funds for Medicaid contributions by $15 billion, while the other proposal would reduce the Medicaid provider tax threshold for a savings of $26.3 billion.

Rather than taking aim at the Medicaid program for spending cuts, state officials have generally shown support for another debt reduction measure in which dual eligibles would be enrolled in managed care plans for an estimated savings of $100 billion, according to the report.

Related Articles on Medicaid:

University of Louisville Physicians Used Medicaid Funds for Personal Bonuses
New York Gov. Cuomo Vetoes Critical Access Hospital Medicaid Payment Bill
New Hampshire AG Says Hospitals Don't Have Right to Certain Levels of Medicaid Payments

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