Medicaid reform project leads to state recommendations
Having worked on issues related to Medicaid populations for almost 10 years,
I was delighted when I was asked to participate in Georgia's effort to review
alternative Medicaid reform options and to help develop recommendations
that would eventually be put forward to the governor. Medicaid is the joint
federal/state program that provides for the health care of certain categories
of the state's poor population: single heads of households with dependent
children, pregnant women/infants and children, the aged and the disabled.
Georgia spends more than $3 billion annually in combined federal and state
dollars under its Medicaid program. Given the proposed federal legislation
for block grants for Medicaid, as well as the continued anti-tax sentiment
among the populace, Georgia, as are other states, is currently seeking better
ways to provide Medicaid services and to generate savings in order to live
within budget constraints. This pressure is compounded in Georgia because
its governor has mandated that 5 percent of the Medicaid budget be re-directed
to state expenditures on education. In addition, Georgia's legislature recently
repealed the state's sales tax on food, thereby putting further pressure
on the state's coffers.
To help look at issues in an organized and informed fashion, the Georgia
Coalition for Health agreed to review other states' reform efforts, undertake
new research, and review input from stakeholders in order to make recommendations
to the governor. This process took place over the past 12 months with more
than $500,000 spent on the expertise of actuaries, economists and other
professionals. I, along with these other researchers and consultants, was
hired by the Georgia Health Policy Center of Georgia State University to
look at these issues. It was extremely satisfying to use my expertise as
a health economist who is familiar with the Medicaid program to evaluate
the state's Medicaid data and summarize research findings to the coalition.
It was also interesting to see that Georgia is unique in the breadth of
its review of other state's actions and its completion of new research before
making a decision about the state's reform actions.
In this process we helped the coalition set up an evaluation framework for
use in comparing the outcomes of each of the reform options. This framework
included: 1) identifying the cost savings achieved; 2) evaluating the impact
on enrollees; 3) considering its impact on markets/communities; 4) measuring
its impact on providers and 5) evaluating its impact on the state's "safety
net." The safety net was defined as those providers obliged to provide
the services regardless of ability to pay (e.g. public health clinics).
The coalition reviewed three basic options for both acute and long-term
care services. I helped provide the coalition with estimates of the dollar
impact of these options on the Medicaid revenue that would be received by
hospitals, primary and non-primary physicians, pharmacies and nursing homes
that now serve Medicaid clientele. I also helped identify areas of the state
in which providers appeared most vulnerable to these revenue changes. In
this process we identified Medicaid market areas in which providers, and
hence communities, were at risk. This type of information helped the coalition
in making decisions about which reform options were most viable and the
time frame over which they could be implemented without harming these areas.
Although our analysis of the reform options showed that none of them resulted
in all of the short-term savings mandated by the governor, it did show which
options were best in providing savings over the long-term, improving access
and maintaining quality of care for Medicaid enrollees. The coalition has
voted on a plan to move more Medicaid enrollees into HMOs and other managed
care programs and a plan to allow more of the elderly and disabled who are
in need of long-term care to receive this care in their homes. We found
this to be consistent with other states' actions in that most states had
included some form of managed care in their efforts to achieve efficiencies
in their Medicaid program.
As I review this years' activities, I realize I have benefited from watching
the political decision-making process as our research was translated to
the coalition in a series of public meetings. It was also rewarding to integrate
the academic "ivory tower" life with the "real world"
of policy deliberation and formulation in such an important endeavor. The
coalition will make its final recommendations to the governor this month.
As researchers we may get a chance to evaluate the outcomes of their actions.
Kathleen Adams is an associate professor in the Rollins School of Public
to the December 9, 1996 contents page