The 40-year-old Medicaid program has been tweaked and bandaged and patched into a bureaucratic maze that poorly serves the needy people it was created to serve and the hospitals and other health care providers it relies on to provide that service. At the same time it has become a runaway financial nightmare that threatens to break every state budget.
Here in Florida, Medicaid costs are $14 billion this year and predicted to rise to $17 billion next year. The program has grown by 88 percent since 1988 and is expected to account for 60 percent of the entire state budget by 2015.
Something has to be done to control those spiraling costs while improving health care for Medicaid patients. Any Medicaid reform must also address the need for hospitals to have guaranteed and predictable reimbursement for treating Medicaid patients and the need to encourage more doctors and other providers to participate in the Medicaid program.
Gov. Jeb Bushs Medicaid-reform plan would empower Medicaid patients by giving them more control over their own health care than ever before. Medicaid would be transformed from a direct, government-regulated payment for service to health care providers into a managed-care model utilizing established private managed-care organizations and provider networks. The governor believes that allowing the private sector to compete for Medicaid patients will increase access and improve the quality of care while holding down costs.
Medicaid patients would be able to choose among companies and benefit plans competing for their business. Counselors would be available to help patients choose a health care plan that best fits their needs. Another innovation would allow patients to earn enhanced benefits through flexible spending accounts by making healthy lifestyle choices such as not smoking. The enhanced benefits would enable patients to purchase increased coverage for more services. Although there would be lifetime benefit limits, as in most health-care plans, the governor has also proposed catastrophic coverage as part of his plan.
The governors plan has been hailed as visionary by some and criticized by others as potentially detrimental to hospitals and other providers. Some say it would threaten the availability of care for the poor and disabled.
Whatever your first impression of the governors proposal, there is no doubt that Medicaid must change for the good of patients, hospitals and providers, and to avoid bankrupting state budgets.
The managed-care model for providing health care is here to stay. More than half of all Americans with health insurance are enrolled in some kind of managed-care plan. There is no reason to believe that Medicaid patients would not also benefit from the access to quality care and cost savings of well-run managed-care companies and networks.
Hospitals, especially those that make up the states medical safety net for the uninsured, and other providers need to be able to count on a reasonable level of reimbursement for the care of patients eligible for Medicaid. Some type of reform is necessary to continue the program. Doing nothing will result in continuing unsustainable cost increases to the state and federal governments and continued losses of doctors willing to treat Medicaid patients because of the low reimbursement levels.
Rather than standing on the sidelines and criticizing the governors proposal, hospitals and other interested parties must become involved in the redesign process. In the legislature, house and senate select committees on Medicaid reform have been holding public hearings throughout the state. The proposal will no doubt be debated throughout most, if not all, of this years legislative session.
Gov. Bush deserves credit for taking the bold initiative to totally reshape a vital but outdated government program that can no longer properly serve it patients and is rapidly becoming unaffordable for the taxpayers. Rather than fear this reform, we should all join in and work to make certain the plan that develops in the legislature is the best it can be for those it serves and for those who must pay for it.
The 40-year-old Medicaid program has been tweaked and bandaged and patched into a bureaucratic maze that poorly serves the needy people it was created to serve and the hospitals and other health care providers it relies on to provide that service. At the same time it has become a runaway financial nightmare that threatens to break every state budget. 
