House gives final approval to Medicaid bill

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(Host) The House has given its final approval to legislation that’s designed to eliminate a projected eighty-million-dollar deficit in the state’s Medicaid program.

Backers of the plan say the proposal achieves its goal without making drastic cuts to the program.
But opponents say the measure avoids the tough decisions that need to be made.

VPR’s Bob Kinzel reports:

(Kinzel) There was very little debate during the two days that the House considered this bill. Despite strong concerns expressed by the Douglas Administration, the legislation passed by a vote of 111 – 16.

The state is facing significant financial problems with the Medicaid program for a number of reasons. Overall health care costs are going up at a double digit rate and more people are using Medicaid – it’s estimated that 25 percent of all Vermonters participate in the program. In addition, the federal government’s share of the program is declining.

The governor’s plan had several elements. It reduced the deficit by using surplus funds, cutting payments to health care providers and imposing higher premium fees for participants.

The House Appropriations committee used the general framework of the governor’s plan but decided that a number of the cuts were too severe. The committee replaced roughly fifty percent of the cuts with additional surplus money. Vernon Rep. Patti O’Donnell:

(O’Donnell) “This is a program that is a lifeline for many of the people that we represent. And that’s how we had to look at it. It’s a program that establishes the health or the unhealth’ of our community doctors and hospitals. And that’s what we had to look at.”

(Kinzel) Burlington Rep. Mark Larson said the plan was a good short term solution to the state’s Medicaid funding problem.

(Larson) “Our goal in presenting this plan was to preserve the programs that Vermonters rely on, to maintain eligibility, so that no one would be eliminated from services that currently receive them, to balance our budget in ’06, to strengthen the long term financial future of Medicaid and to preserve access.”

(Kinzel) Administration Secretary Charlie Smith says the plan has some serious flaws because it relies too heavily on surplus funds and doesn’t address some of the key issues that are responsible for the rapid growth in the program.

(Smith) “This problem won’t solve itself. And we can’t spend our way to a solution here. We have got to curtain the program. And this is the year where we’ve got to start making some tough decisions.”

(Kinzel) The measure now goes to the Senate for its consideration – it’s very likely that the legislation will be incorporated into the Senate’s overall Budget bill for next year.

For Vermont Public Radio, I’m Bob Kinzel in Montpelier.

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