Group says Medicaid block grants would hurt Nevada

WASHINGTON — A health care advocacy group sounded a warning Thursday for Nevada, saying a plan to convert Medicaid into state block grants would lead to $6.9 billion in cuts to the Silver State over the next decade.

Reductions in the federal share of Medicaid inevitably would cause governors and legislatures to consider tightening eligibility for recipients, reduce benefits, or cut payments to doctors and hospitals to where some may refuse to participate in the program, according to Ron Pollack, executive director of Families USA.

“I don’t know what combination will occur in Nevada or any other state but those are the things that undoubtedly are going to happen in one form or another,” Pollack said.

“It is going to mean a lot of people who would get help under the current program are going to lose that help,” he added.

Families USA, a nonpartisan consumer health group, issued a report critical of the plan unveiled this week by Republicans in the House that seeks to reduce the federal deficit by $5 trillion over a decade through long-term spending cuts and by making dramatic changes to Medicare and Medicaid.

The Families USA report states that the Republican plan would shift $1.4 trillion out of Medicaid by 2021, about a one-third reduction in federal support, in part by capping the block grants.

For Nevada, the group said it would cut $2.9 billion from the state’s current program over time, and another $4 billion by eliminating an expansion of Medicaid set for 2014 in the health reform law passed last year.

The advocacy group’s study echoed one issued on Capitol Hill by Sen. Harry Reid, D-Nev. In a report compiled by Democratic policy analysts, Reid said the GOP budget plan would “force at least 136,000 Nevadans off Medicaid.”

Because Nevada’s Medicaid expenditure level of $4,586 per enrollee is below average among states, a block grant based on current spending would cement the state’s low standing at a time its elderly population is growing, Reid said.

The Republican plan “would require larger and larger Medicaid cuts over time, just as more seniors require Medicaid and health care costs continue to rise,” Democrats said.

But Republicans in their budget plan said Medicaid “is coming apart at the seams, and costs will be “nearly impossible to check” without changes.

Medicaid costs in 2009 were $378.6 billion, said the proposal authored by Rep. Paul Ryan, R-Wis. Absent reform, costs are expected to reach $840 billion by 2019.

Ryan promised block grants would be “tailored to meet each state’s needs, indexed for inflation and population growth.” Freed of federal requirements, states would “offer their Medicaid populations more options and better access to care.”

Nevada Republican Reps. Dean Heller and Joe Heck said this week they supported the plan.

Gov. Brian Sandoval was silent when asked Thursday through a spokeswoman. “We have not taken a position on this,” said Mary Sarah Kinner.

Charles Duarte, Nevada Medicaid administrator, said he was studying the proposal. “The idea of a block grant can be a good thing if the flexibility is there and if the methodology for calculating the grant allocation is fair and reasonable,” he said.

At first glance, he said, that does not seem to be the case with the Ryan plan. It seems to tie grants to a general rate of inflation while Duarte said it should be linked to the inflation rate for medical costs, which run two to three times higher.

And while the Republican proposal would index grants to state population growth, Duarte said it would be fairer if they were linked to employment, since Medicaid caseloads rise and fall — mostly rising in Nevada — based on the job picture.

The number of Nevadans enrolled in Medicaid is expected to grow from 280,000 presently to 312,000 by 2013 before leveling off, Duarte said.

“Neither index method is good for our state,” Duarte said. “They are good for the federal government. Governors need to take a close look at this.”

Contact Stephens Washington Bureau Chief Steve Tetreault at stetreault@stephensmedia.com or 202-783-1760.