WASHINGTON That day in July was one that Tammy Morse won’t soon forget.
Five months earlier, her husband lost his job as a recruiter for the
financial services industry. Now it was the summer and the family savings
were gone. She saw no way to get health insurance coverage for her family
other than to apply for Medicaid.
And that was why she made the drive from her Stratford, Conn., home to the
nearest office of the state’s Department of Social Services.
“It was humbling,” said the mother of two. “It’s funny how your attitude
changes, because honestly, I was probably a little judgmental previously.
… For lack of a better way to put it, that was for other people. It
wasn’t for me.”
Around the country, similar stories are playing out for thousands of
families.
Since the recession began a year ago, many states have seen increases in the
Medicaid rolls just as tax revenues are falling below projections. Governors
have lobbied President-elect Barack Obama and Congress to help them weather
the downturn by increasing the federal government’s share of Medicaid
spending for at least two years.
The governors said the extra $40 billion would ease the service cuts or tax
increases that legislatures need to balance state budgets.
The unemployment rate has jumped from about 4.7 percent last December, when
the recession began, to 6.7 percent today. Economists estimated in a Kaiser
Family Foundation report that each 1 percent gain in the unemployment rate
adds 1 million people to the Medicaid and State Children’s Health Insurance
Program.
In Connecticut, a state faring better than many, enrollment in the Medicaid
program, called HUSKY (Healthcare for Uninsured Kids and Youth), has climbed
from about 312,000 last December to about 329,500 in November ‹ a 6 percent
increase. Many who lost their jobs were eligible to continue group health
insurance. But that is not an option in most cases because they no longer
have an employer picking up a large share of their premiums.
Cassandra Edmonds, a single parent who joined HUSKY in October, is a
newcomer to the program like Morse. Her job as a parent-activities
coordinator with the Bridgeport school district was eliminated to save
money. She has found a job selling life insurance, but her earnings are low
enough that she is eligible for HUSKY coverage.
The insurance is particularly important for her 4-year-old son, who has
glaucoma and tubes in his ears to prevent repeated infections. He has to
check in with a specialist about every three months for each condition.
Edmonds said she never imagined she would be relying on government safety
nets to make that happen.
“I never really thought I would be without a job,” Edmonds said. “I have an
MBA. I’m not trying to sound cocky or anything.”
Donny Djurkovic doesn’t have a master’s in business administration, but he
did have decades of work experience when he lost his job with a small food
company. Djurkovic, like Morse and Edmonds, is from the Bridgeport area.
He said he was able to continue health insurance for himself, but insuring
his son would have increased his premium to more than $1,200 a month. So his
son, 6, went without insurance for a few months, leading to much worry.
“I put his bicycle in the shed. I didn’t want anything to happen, to be
honest with you,” Djurkovic said.
He learned about HUSKY from a pharmacy clerk and took her advice to apply.
Despite the relief, he admits to some feelings of guilt about accepting the
government’s assistance.
“In all these years, I never had put my hand out and I was so proud of
myself and everything. But there is unfortunately times when you do need
it,” he said. “And I still feel bad. Would you believe this? When I see my
unemployment insurance, I say this is not me. I’m not used to it.”
Medicaid insures nearly one in six low-income people in the U.S. The program
typically covers the very poor and about half of enrollees are children.
Spending came to $333 billion in the budget year ending Sept. 30, 2007.
Washington picks up about 57 percent of that; the states cover the
remainder.
Michael Cannon, director of health policy studies at the Cato Institute, a
liberterian think tank, sympathizes with new families now relying on
Medicaid. Still, he disagrees that the federal government should reward
states that did not plan adequately for the bad times. Better planning would
mean setting aside more money for rainy day funds and not expanding the
scope of Medicaid during the good economic times, he said.
“The states make these promises they know they can’t keep and then they run
to Congress to bail them out,” Cannon said. “And Congress typically ends up
bailing them out.”
Cannon said the net result is the government gradually is becoming more
responsible for paying for health insurance coverage.
The bill will fall to future generations. “And who better to push those
costs onto than to people who can’t even vote yet?” Cannon said.
Advocacy groups report that 43 states face budget shortfalls this year or
next. The Center on Budget and Policy Priorities estimates states face a $79
billion gap they must bridge this year.
Nineteen states have enacted or proposed cuts in their Medicaid or State
Children’s Health Insurance Program budgets for the current budget year or
for 2010, according to Familes USA, which conducted a state-by-state survey:
_Arizona now requires adults to reapply for Medicaid every six months rather
than annually, which is expected to reduce the rolls by 4,500.
_California does the same for children, and Republican Gov. Arnold
Schwarzenegger proposed reduce eligibility limits for parents from 100
percent of the poverty level to 72 percent. That would drop it from $17,600
to $12,600 for a family of three. The state also is considering putting new
applicants for children’s insurance on a waiting list.
_Nevada eliminated vision care for adults and limited coverage for personal
care services that reimburse providers for helping people meet basic needs
such as feeding and bathing.
_South Carolina enacted a limit on prescriptions and refills to a maximum
31-day supply.
_Rhode Island limited coverage for prescription drugs to generics.
The most common Medicaid cut that states made was to lower payments to
doctors and other providers; some 14 states have done so this year. Medicaid
patients already often have trouble finding a doctor who will take them, so
the payment cuts could make that problem worse.
Diane Rowland, executive vice president at the Kaiser Family Foundation,
said that boosting the Medicaid matching rate will prevent higher rates of
uninsured and maintain patient access to hospitals, nursing homes and home
health care.
“In the absence of this kind of stimulus, you might see more layoffs in the
health care sector,” she said. “These dollars can start to flow to states
the day after Congress enacts it because it’s just changing the formula for
how Medicaid bills are shared.”
Rowland said some states did expand during the good times, causing a portion
of the budget crunch they now face, but for the most part, the problem is
the economy.
“It’s not so much an issue of expansion. It’s an issue of how we deal with a
downturn in the economy,” she said. “On the income side, we have
unemployment insurance. On the health care side, all we have is Medicaid and
the State Children’s Health Insurance Program.”