The Changing Face of Medicaid (1995)

Changing the structure of Medicaid is our lead focus tonight. Margaret Warner has the story. One of the sharpest confrontations in the current budget battle between President Clinton and the Republican Congress has developed over the future of Medicaid. This federal and state-funded program covers the health care costs of about 36 million Americans, the poor, the elderly, and the disabled. We begin with this background by Fred de Sam Lazaro of public station KTCA. Medicaid was created in 1965 as part of a larger welfare bill to provide health insurance for low-income Americans. Shalandra Burt just turned 18 making her ineligible to remain on her mother's private health insurance policy. Pregnant with her first child, the Detroit woman is now eligible for Medicaid coverage. Right now it's kind of convenient but once I get back on my feet now and go to college and get a degree, get some kind of education and get another job to make some money then I'll probably be able to buy insurance then. The level of benefits Burt and receives

is determined by the state. Those benefits vary among states which are allowed to administer Medicaid according to their own criteria within broad federal guidelines. The federal government provides matching funds, a share arranging from 50 to 85 percent depending on the average income of the state's residents. Today the total tab for Medicaid is $155 billion a year but only one third of those dollars are spent on the poor, the original intended beneficiaries. Next number, B13. Two-thirds of the Medicaid dollars actually go to elderly and disabled Americans who've become impoverished by their need for long-term care and eventually qualify for Medicaid. Eugene Feingold is a professor of public health at the University of Michigan. A Medicaid-based long-term care very often from middle class people who can't afford the cost of medical care or the long-term care and actually that's the bulk of the spending

in Medicaid is not for welfare people but rather for middle income and other people who are getting long-term care and can't afford to pay for it. I've been here now going on starting my sixth year, and I love it here, all at my nurses and doctors. I'm so thankful for them all. 87-year-old Tommy Warner, a former construction worker, is one of 3.7 million elderly Americans who receive benefits from Medicaid. At this Detroit nursing home the cost of a semi-private room and board is about $2,700 a month. Warner's Social Security and pension cover only a fourth of that cost. Under Medicaid rules, a beneficiary savings and other assets must cover the rest until those funds are exhausted. Medicaid then takes over. It pays most of Warner's bills that his pensions don't cover. Nursing home director Lowell Schrupp. Most of the people who are on

our campus receive assistance from the state or the federal government. One man or another in our nursing home about 90% of our 120 people who reside here are on Medicaid programs. We want to start having you type all the letters you can reach. Over the years, Medicaid eligibility has also been extended to some 4.9 million disabled Americans, including six-year-old Joshua Grist who is visually impaired and has cerebral palsy. All right, let's see a type of few more letters and then we'll be finished with our typing. Joshua spent most of his first three years in hospitals undergoing surgery on 38 separate occasions. He's since stabilized enough to live at home with his mother Angie but also with considerable home health care services paid for by Medicaid. He has 16 different medications. We carry medications all the time and in case he goes into a severe seizure or in case his airway shuts down. Oxygen is a

regular part of his life wherever we go. We carry oxygen. He's regularly on a feeding pump. He's on monitors to monitor his heart rate monitor, his respiration rate to measure the level of oxygen in his blood to make sure that he's processing oxygen. Okay. A few years ago Joshua Grist would likely not have survived his medical challenges but the modern medical technology that sustains him comes at a cost. Technology has been one of the biggest factors that is driving up the cost of Medicaid. Another factor is growing enrollment in the program. Having a contraction? Yeah. The state of Michigan for example extends Medicaid coverage to most uninsured pregnant women and their children, not just those on welfare. This has increased the cost of Medicaid especially for the federal government. Many states have been able to manipulate the matching fund formulas to increase the federal share of the jointly financed program. As part of their seven-year plan to balance the budget the Republican-controlled House and Senate have passed a bill that would end

Medicaid's entitlement status, block granted to the states, and slow the growth of spending in the program from the current 10 percent a year to about 4 percent annually. That would save 162 billion dollars over seven years. President Clinton has proposed far more modest savings and says he cannot sign the Republican bill. Here to debate the issue now are Republican Senator Don