Disabled costs push Medicaid spending

Care for disabled people is the largest factor driving up spending on the state's Medicaid health insurance program for the poor, accounting for more than half of the soaring growth in the last five years, according to an analysis released today by a new nonpartisan policy institute.

Compared to other states, Massachusetts provides more generous health coverage for a larger percentage of disabled residents. Last year, the state spent nearly $2 billion to provide health care for more than 200,000 children and low-income adults under the age of 65 with mental and physical disabilities, according to the report from the Massachusetts Medicaid Policy Institute, established last year by the Blue Cross Blue Shield of Massachusetts Foundation. Spending on people with disabilities grew at more than twice the rate of spending on Medicaid's other beneficiaries -- poor families, children and seniors.

The numbers reflect the state's decision about a decade ago to expand coverage for disabled people, which enables most to live in the community and some to work. But the report says the state has not been as aggressive as others in managing care for the disabled, which could improve quality and cut costs.

Ronald Preston, the state secretary of Health and Human Services, said the growth in Medicaid "represents a very steep challenge" but results from "a good thing -- people (with disabilities) are living longer." He said the state has no plans to cut eligibility or benefits but will expand managed care.

"We want to do it right," he said. "I don't want some sort of oppressive managed care."

During the next two to three years, the state plans to roll out programs for the disabled similar to one just beginning for seniors in which a broad range of services are coordinated by a primary caregiver, according to assistant secretary Gerry Morrissey.

State officials said they hope the programs, which are still being developed, will help slow the growth of spending.

Nearly half of the disabled people on Medicaid have three or more chronic conditions, which makes their care complicated, according to the report. Common disabilities include depression, mental retardation, and paralysis.