A 56 percent increase in the total cost of Medicaid from 2001 to 2005 has set off alarms in state government, calling for changes to stop the drain on the state budget.
An Ohio commission to reform Medicaid, created in 2003 by the Ohio House, spent last year reviewing the system and creating recommendations to give to Gov. Bob Taft. The $12 billion Medicaid program is overwhelming the state, growing at twice the rate of the state income and is responsible for about 40 percent of the state general revenue spending, said Jennifer Carlson, executive director of the commission.
In 2005, Ohio spent $10.5 billion on Medicaid compared to the $6.7 billion spent in 2001 and saw costs rise 13 percent from 2004 to 2005. With an average monthly caseload of 1.7 million people, up from 1.3 million in 2001, roughly one out of every eight Ohioans receives Medicaid benefits.
There is no single reason for the rising cost of Medicaid -it can be attributed to rising medical service costs, increases in the costs of prescription drugs, changes in eligibility -which increases program enrollment -and cost hikes of long-term care, said Jon Allen, spokesman for the Ohio Department of Job and Family Services. The department is responsible for the administration of Medicaid in the state.
The commission has suggested a two-stage strategy to get a handle on Medicaid costs.
We stressed that change has to begin now
to stop the bleeding and get Medicaid spending under control. We have to establish a firm budget target and provide the tools for the administration -there is a need for the ability to adjust to change and not have our hands tied through legislative rule or statute -to eliminate set Medicaid rates Carlson said.
The initial stage comprises a set of eight steps to be taken over the next six months, which include decreasing the costs of long-term care, reforming pharmaceutical and other costs and establishing a target budget and a reduction of cost for each patient, Carlson said. The budget and cost reductions are more long-term visions than immediate measures, she said.
The bulk of the recommendations will be taken into account for the next fiscal year, beginning in July, said Orest Holubec, Gov. Taft's spokesman.
We don't have a lot of choice (in following recommendations) -there will be plenty of time for public and legislative debate which is an important part of the process
Holubec said.
The costs of two of the biggest drains on Medicaid, prescription drugs and nursing facilities, have increased by about one billion dollars and $45 million, respectively, in the past four years, Allen said.
Prescription drugs are more expensive; they're new and improved drugs that come out -it's a positive that they can be prescribed
but more drugs are being prescribed than in the past
which could be a negative
Allen said. The overwhelming bulk of the money is spent on drugs that the Medicaid program pays for.
Athens County has its own share of Medicaid cases with an average monthly load of 5,093 adults and 5,061 children in 2004, said Tracy Galway, Athens County Department of Jobs and Family Services community relations coordinator. Seventy-three percent of the Athens department budget is spent on Medicaid costs and services.
People qualify for Medicaid based on their income and family size, or if they are aged or disabled, she said.
Medicaid is fairly complicated
with many subcategories first based on income eligibility
usually household income. It depends on whether it's a family with children
just a child or someone elderly or disabled -overall it's a medical program for low-income individuals
Galway said.
Eligibility for many state-assisted programs start at the 100 percent poverty level. A single person living at this level of poverty must make less than $776 per month. The income level per month can rise up to $265 for each additional person in the home. So, for example, a single mother with one child would have to make less than $1,041 per month to be eligible for Medicaid in Ohio.
The level is set so low
