As Medicaid Enrollment Spirals Up, HME Cuts Spread

WASHINGTON — In a stark testimony to the collapsed
economy, every state in the union saw an increase in Medicaid
enrollment and Medicaid rolls swelled by 3.3 million in the year
from June 2008 to June 2009, the largest ever, according to a new
report.

“This marks the first time since the early 1990s that enrollment
has grown in every state,” said the analysis, released last week by
the Kaiser Family Foundation’s Commission on Medicaid and the
Uninsured.

The report also said that June 2009 monthly Medicaid enrollment
grew 7.5 percent to 46.9 million people and noted that in 32
states, enrollment in the massive program grew at least twice as
fast as the year before. Most of the growth — 60 percent
— occurred among children, the report stated.

Analysts suggested the ballooning Medicaid numbers were likely
due to the millions who lost their jobs and their employer-based
health insurance.

“State Medicaid programs have been able to help millions of
Americans who have nowhere else to turn in a recession,” said Diane
Rowland, executive vice president of the foundation and executive
director of the commission. “But the states obviously face
significant fiscal pressures as increases in enrollment push up
costs at a time when state budgets are already severely
constrained.”

Home medical equipment providers in numerous states have been
working to deflect devastating reimbursement cuts as state
governments seek to contain their rapidly escalating Medicaid
costs. The Florida Alliance of Home Care Services reported earlier
this week, for example, that Florida’s Medicaid program is
considering requiring all beneficiaries to enroll in managed care
plans as a way to cut expenses, a move that could leave HME
providers out of the Medicaid picture altogether.

Members of the Midwest Association for Medical Equipment
Services are fighting big cuts in several states: Kansas providers
are looking at a 10 percent across-the-board cut; Missouri Medicaid
announced last week that starting March 1, its new fee schedule
would be 90 percent of Medicare allowables; and in Minnesota,
members have been hit with a near 5 percent Medicaid cut (in
addition to 19 percent cuts in BCBS reimbursement and tax audits
from the state’s Department of Revenue).

According to the Kaiser report, Medicaid costs in the near term
are unlikely to halt their upward spiral anytime soon.

“Given historical trends in Medicaid enrollment, it is likely
that enrollment will continue to rise over the next year,” the
report predicted. “The impact of the economic recession on children
and families through job loss and the corresponding loss of health
insurance is still being realized.”

According to another Kaiser study that surveyed Medicaid
directors, 44 states and the District of Columbia are grappling
with higher enrollment than expected, and 29 states reported they
were considering additional mid-year cuts in both provider rates
and program benefits. The state directors said they expected a big
strain on already beleaguered budgets when the federal matching
money program expires Dec. 31.

For more on HME Medicaid cuts, see Maine Providers Win One,
Others Continue Medicaid Battles, Feb. 5.