New survey finds up to 29 states may cut Medicaid program benefits

WASHINGTON As many as 29 states said they are considering additional mid-year cuts in provider rates and program benefits for Medicaid, according to a new Kaiser Family Foundation survey released Thursday. The survey of state Medicaid directors found that 44 states and the District of Columbia are experiencing higher-than-expected program enrollment, resulting in increased spending for fiscal year 2010.

Nearly 3.3 million more people were enrolled in state Medicaid programs in June 2009 compared to the previous June, cited an analysis from the Kaiser Family Foundation’s Commission on Medicaid and the Uninsured. That marks the largest one-year increase in terms of absolute numbers in recent history, and boosted the June monthly Medicaid enrollment by 7.5% to 46.9 million people.

It also was the first time in decades that every state experienced an increase in Medicaid enrollment, the Foundation stated. And in 32 states enrollment grew at least twice as fast as the year before, according to the analysis, which includes data breakouts by state.

The increase in enrollment reflects the role that Medicaid plays in reducing the numbers of people who become uninsured when the economy falters, with many people turning to the program for help after being laid off and losing 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,” stated Diane Rowland, EVP of the Foundation and executive director of KCMU.  “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.”

Enhanced federal matching money for Medicaid provided through the American Recovery and Reinvestment Act of 2009 has proved critical in helping states maintain coverage. But that money is scheduled to expire on Dec. 31, 2010, which will increase the strain on state fiscal year 2011 budgets, Medicaid directors reported.