The Alabama Medicaid program is bracing for a potential domino effect.
Ongoing debates in the Alabama Senate have left those in the medical community fearful that problems resulting from an under-funded Medicaid budget could affect Alabamians at all income levels in the future.
Judy Gould, vice president of public and professional relations at Regional Medical Center in Anniston, said that the budget cuts being discussed may seem inconsequential at first, but in fact could create long-term consequences across several health-related fields.
“Our mission is to care for the community,” said Gould. “If we start losing things like prescription drug coverage, patients will be forced to come back to the hospital, to the emergency room. We need to focus on wellness, on keeping people out of the hospital.”
For now, the decision is out their hands.
On Tuesday, an Alabama Senate committee approved a $418 million Medicaid appropriation for the 2013 fiscal year. The decision comes after an earlier budget allowed for a $175 million cut to the program. Although the most recent appropriation allots more money than the original $400 million approved by the House earlier this year, the budget is still significantly less than what Dr. Don Williamson, the state’s health officer, says is “the bare minimum” required to effectively run Medicaid in the state.
To make up the difference, the amended bill passed by the Senate committee proposes the matter go before voters as a constitutional amendment in November. If the amendment passes the House, voters would decide whether Medicaid would receive an additional $184 million from an oil and gas trust fund, as well as an education savings account.
Then, the decision to reroute funding would be in the hands of the people.
The additional funding, Williamson said during a conference call Tuesday, is essential. Under federal guidelines, he said, the program would not legally be able to operate with the proposed $418 million budget. The additional $184 million would increase the Medicaid budget to $602 million, what Williamson said is the “smallest number you can actually make work.”
According to a January 2012 report by the Alabama Medicaid Agency, 21.1 percent of the state’s population qualified for some type of Medicaid funding for at least one month during the 2011 fiscal year. In Calhoun County alone, 25.5 percent of the population is eligible for Medicare.
“This is a much bigger issue than simply a Medicaid issue,” Williamson said. “Medicaid’s survival is not just important to Medicaid patients, it is important to every patient in the state.”
In particular danger, said Williamson, are children and the elderly.
A January 2012 report released by the Alabama Medicaid Agency indicated that more than half of all babies born in Alabama and two-thirds of all nursing home residents are covered by Medicaid. In Calhoun County, more than half—53.9 percent—of children are eligible, according to 2010 Medicaid statistics. Fifty-one percent of all babies born in the state are delivered via Medicaid funding, Williamson said during the conference call.
Under the 2012 budget, which was passed last year, several Medicaid programs must still undergo cuts, whether or not they receive the extra funding, Williamson said. Beginning June 1, those include a 10 percent cut to physicians’ fees, dentists, X-rays and lab work.
Cuts in dental budgets mean potential problems for one of Alabama’s largest dental and optical not-for-profit clinics. Sarrell Dental, which began in Anniston, now provides services at 14 offices and a mobile dental bus across the state’s most needy areas, accepting both Medicaid and ALLKids insurance plans.
Jeffrey Parker, Sarrell’s chief executive officer, said 66 out of the 67 counties in Alabama face a shortage of dentists. He said that while Sarrell understands the state's budget difficulties and is ready to accept cuts because of them. Those cuts, however, would impede further Sarrell's expansion, Parker said.
“Because of our current economic environment and ever increasing Medicaid roles, not just in Alabama, but throughout the U.S., we worry that cuts in Medicaid reimbursements will further reduce access to care,” Parker said.
As of now, however, Parker said, the company anticipates the cuts and has planned accordingly.
“Sarrell Dental is fully prepared to accept the anticipated across-the-board cuts in Medicaid reimbursements,” Parker said. “In spite of these cuts, Sarrell Dental will continue to provide services to children who have no voice or access to care.”
Other Medicaid-funded services, however, are not as prepared. Future planning depends on decisions made by the state government.
Williamson said that although he cannot mandate a 10 percent cut to professionals who provide medical care to pregnant women, he could take action affecting another group of service providers: those who call or otherwise contact Medicaid recipients reminding them to keep up with their appointments.
Williamson stressed that the cancellation of contracts with this second group of providers would not affect maternity care or delivery.
Cuts to the maternity care program, said Gould, particularly those in charge of ensuring expectant mothers show up to their doctor appointments, could create long-term problems.
“Adequate budgets are extremely important, particularly for the maternity care program,” said Gould. “If they are not properly funded, these moms will not get the care they need, we will not be able to offer prenatal care, we would have difficulty with moms as well as babies, immunizations and Well-Child checks, which are all critical in ensuring children remain healthy.”
To ensure that more cuts are not necessary, Williamson said, the passage of the amendment is crucial.
“If the amendment fails,” Williamson said, “the Medicaid program will not be funded and the system as we know it would go away.”
The success of the Medicaid program, explained Williamson, lays the foundation for the rest of the medical environment in the state. Although the majority of Medicaid patients live in more rural communities, the failure of Medicaid, he said, could affect urban communities. As rural communities lose doctors, rural hospitals close and nursing homes go out of business, urban centers could potentially suffer under the burden of an influx of new patients seeking medical services.
William Stewart, professor emeritus at the University of Alabama’s political science department, said that although he understands adequate funding for the Medicaid program is essential, he does not believe adding another amendment to the constitution is the best way to solve the problem.
“Medicaid is a very costly, but very necessary program for many people concerned,” said Stewart. “One the one hand, I don’t want to see people suffer, but on the other, I hate to see another amendment added to the constitution.”
The proposed “short-term fix,” Stewart said, is reminiscent of practices in the past, in which the government borrowed money from the Education Trust Fund Rainy Day Account. In 2010, Gov. Bob Riley withdrew $123.8 million from a the General Fund’s rainy day account, also in an attempt to prevent cuts to the General Fund, a significant source of funding for Medicaid.
“Those savings accounts were set up to meet long-term needs,” said Stewart. “They are not being used properly.”
The consequences involved, however, force Stewart to see the other side.
“I recognize, however,” said Stewart, “that if this is the only way we can prevent people from suffering or possibly dying, I’d have to vote for it, because obviously we can’t let that happen. I will not cast any vote that would mean suffering or dying to any of my fellow Alabamians.”
David Lanoue, dean of the political science department at Columbus State University, said that in order to pass, the amendment would have to be sold very carefully to voters.
“It is going to be a challenge,” Lanoue said. “The default is to vote no when people have doubts or concerns,”
Voters, he said, need to understand the potential ripple effects that could affect the entire health care system should the Medicaid program fail.
“You can’t depend on voters to necessarily understand the intricacies of Medicaid funding,” said Lanoue. “You have to put what’s at stake in very clear terms and you have to fight against the reflexive tendencies of voters to vote no.”
$184 million in funding restored in late action
In a late development Thursday night, the Alabama House gave final approval to a $1.4 billion General Fund budget that restores $184 million in Medicaid funding and takes it from Alabama’s prison system.
The Senate voted 21-10 to approve the budget for most non-education state services. But the austere spending plan is different than the one that passed the House and a conference committee will likely work out the differences.
A Senate committee had approved a budget that depended on voters approving transfer of $184 million from an oil and gas revenue savings account and from education funds to Medicaid.
The Senate amended it so that the funding hole is in corrections, not Medicaid.
The Senate also amended the budget to restore Medicaid funding for a program that provides medicine for low income senior citizens and to a program to provide prosthetics to Medicaid patients.
Senate Minority Leader Sen. Roger Bedford, D-Russellville, made the motion to restore the funding to Medicaid and take it from prisons.
Asked what would happen if voters did not approve transferring the education and oil and gas money to corrections, Bedford said there would be enough time to fill the funding gap in the regular session, which starts in February.
— Associated Press