July 18, 2005

State Governors Gather to Discuss Medicare

According to the Associated Press, a number of governors gathered on Sunday to discuss a number of national concerns, chief among them the budget concerns over rising Medicare expenses. Some governors believe that the President's new policy changes will unfairly require the states to pick up a large portion of the new prescription drug benefit.

A significant portion of the discussions focused on a small part of the new policy dealing with individuals old enough to qualify for Medicare and poor enough to qualify for Medicaid. The states want the federal government to absorb the expenses for this group of individuals, which are significantly larger than the rest of the Medicaid population.

According to some governors, a number of states are contemplating a lawsuit against the government, while others are hoping for a settlement. Governor Rick Perry of Texas has already vetoed the $444 million that was budgeted to be sent to the federal government during the next two years, and has urged fellow governors to discuss changing the federal policy. Vermont's governor has acted similarly, setting aside the $43 million his state would owe until a decision is made on who pays for these services.

The governors say they have the support of all 50 governors in seeking to implement experimental programs with the aims of slowing the growing cost of Medicaid and developing more effective ways to deliver health care. One idea proposed would allow states to collect a copayment from recipients, and some programs would offer incentives (such as quitting smoking or losing weight) that would reduce or eliminate that copayment. The governors believe that they need to come up with a bipartisan plan that is possible before we can hope that Congress could reach such a consensus.