R.I. lawmakers debate plan to overhaul Medicaid
PROVIDENCE, R.I.—A key Democratic lawmaker urged Gov. Don Carcieri on Tuesday to create a backup plan in case a proposal to cut $67 million in Medicaid spending fails or is delayed.
Carcieri is counting on the Medicaid overhaul as part of a precariously balanced $6.9 billion state budget that the General Assembly approved last month. Eager to close a $422 million budget deficit, lawmakers included Carcieri's Medicaid proposal before they saw the specifics.
By law, Rhode Island must have a balanced budget.
Medicaid, which accounts for about a quarter of state spending, funds health care for the poor, disabled and elderly residents. Under the proposal, Carcieri would cap state and federal Medicaid spending at $12.4 billion over five years. State officials hope that if they offer to cap costs, the federal government will increase its contribution to the Medicaid program.
But there's also a danger. If the state exhausted that money, it would be responsible for paying for any overruns or cutting programs.
Carcieri is hoping to quickly negotiate a deal with the federal Centers for Medicare and Medicaid Services and implement the plan by October, a tight timetable. Lawmakers will have an opportunity to reject any agreement Carcieri reaches with federal regulators.
"We need to talk at some point at least (about) a Plan B," Rep. Steven Costantino, the Democratic chairman of the House Finance Committee, said during a hearing Tuesday.
Adelita Orefice, deputy secretary of the Executive Office of Health and Human Services, said the state can make changes to its Medicaid program that save $25 million without federal approval. If Carcieri's team cannot reach a deal with the federal government, it may need to make budget cuts to save another $42 million.
Orefice said her department has not decided which services would be cut.
Responding to questioning by Costantino, Orefice said that if the federal government approves Carcieri's plan, the state would have to vigilant to make certain it does not run out of Medicaid money.
"It requires a whole lot more fiscal discipline than we're used to," Orefice said.
A major goal of the plan is reducing by 12 percent the time elderly patients spend in expensive nursing homes.
Instead, state officials want to see if more elderly patients could remain at home with additional support from the state, such as assistance taking medication. The state also wants permission to use Medicaid money to pay for shared-living arrangements, such as a nurse who cares for a handful of elderly patients in a private home.
Under the proposal, elderly patients would be divided into three levels of need. Only those with the most severe needs would be guaranteed nursing home or institutionalized care. Service could be cut for other groups if money grew short.
