President Obama Supports State Flexibility in Health Care — Just Not the Kind That Might Work


President Obama said Monday that his administration supports "giving states the power to determine their own health care solutions." Great! Apparently, however, that doesn't extend to giving states what many governors are now asking for: no-strings block grants to run their Medicaid programs.

Currently, the federal government funds state Medicaid programs on a matching basis, with the federal government paying, on average, about 57 cents of each dollar spent. But several GOP governors, including Mississippi's Haley Barbour and Florida's Rick Scott, have said they'd prefer to receive pre-negotiated, strictly capped federal grants—and then be allowed to run the programs themselves.

Switching to a block grant system helped reform the welfare system in the 90s. So why are block grants off the table now? Obama's Medicare and Medicaid director, Donald Berwick, won't say, according to The Hill:

When pressed for an explanation of why the administration opposes block grants, Berwick declined.

"That's all I have to say about that right now," he said.

That's a shame, because a wholesale reform focused around block grants offers a plausible path toward bringing Medicaid spending under control for both state and federal governments. By the end of the decade, total Medicaid expenditures are projected to hit $840 billion, with more than $500 billion of that the federal government's responsibility.

This year, states face about $125 billion in budget gaps—and Medicaid is one of the biggest contributors to the problem. Today, the program already represents more than a fifth of total state spending; it's the biggest single part of state budgets, and it's getting bigger. State spending growth on Medicaid doubled between 2008 and 2009, the most recent year available—in large part because enrollment grew by 40 percent.  

Block granting would on the one hand remove the federal-match incentive to mindlessly ratchet up spending on the program. It would also allow states the freedom and flexibility to manage the programs, including benefits and eligibility, as they see fit—and as they can afford. As former Congressional Budget Office director Douglas Holtz-Eakin and Michael Ramlet note in a report released this week by the American Action Forum, a pre-capped Medicaid waiver program in Rhode Island is already producing big savings:

In January 2009, Rhode Island took the lead on this aspect of reform and became the first state in the nation to cap its entire Medicaid program.  The state received approval to operate the Rhode Island  Medicaid program under an aggregate budget ceiling of $12.075 billion through 2013. The approved Global Consumer Choice Compact Waiver established an expedited 45 day approval process for any  changes to benefits or the Medicaid program during; set new levels of care for determination of long term care eligibility; allowed for benefits in any optional or mandatory program to be customized; placed a priority on preventative services; created a healthy choice account to reward healthy behavior; and implemented new purchasing strategies that focused on quality and competition.

In the first 18 months of Rhode Island's global waiver yielded $100 million in savings, staving off eligibility limitations.  The state projects that it will have saved $146 million by June 2011 with an additional $50 million gained through program integrity efforts and aggressively tracking fraud, waste, and abuse.  Concurrent with the substantial savings, new expenditure growth in the Rhode Island Medicaid program has declined from over 8 percent to 3 percent in the past 18 months.

So Health and Human Services Secretary Kathleen Sebelius says she wants to help states find ways to save money on Medicaid. And President Obama says he wants to empower states to manage their own health systems. Sounds reasonable. 

But presented with a solution that several governors have explicitly asked for—one that's been shown to save money where it's been tried—they're not interested, and the administration's Medicaid chief won't explain why. Seems like Obama's a lot less interested in doling out power to the states—and a lot more interested in maintaining it for his administration. 

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  1. soylent green aint just for the elderly

    1. It’s a tasty treat for kids of all ages.

      Soylent Green. Made from the best stuff on Earth–people!

    2. soylent blue is made from the elderly. It gets its color from the hair.

      1. “If it’s chicken, chicken ? la king. If it’s fish, fish ? la king. If it’s turkey, fish ? la king.”

        1. “Now who wants brunch… cooked with plenty of confidence.”

  2. When pressed for an explanation of why the administration opposes block grants, Berwick declined.

    “That’s all I have to say about that right now,” he said.

    Berwick is Forrest Gump?

    1. Life is like a box of chocolates. Someone could swap them for shit and you might not notice unitl its too late.

      1. chocoshit & soylent green is what’s for breakfast!

  3. Flexibility from Obama? Isn’t that like having a choice between the electric chair and the gas chamber?

    The Fashion of Qaddaffi.…..daffi.html

    1. We don’t take kindly to blogwhores round heah.

  4. Obama’s right to be skeptical. History does not look kindly on giving Southern GOP governors any sort of flexibility in how they spend money, or giving them any sort of power in running government programs. Since Rick Scott is a convicted fraudster, the feds need to exercise extra scrutiny with Florida money.

    1. Since Rick Scott is a convicted fraudster…

      Yeah, and since government agencies and prosecutors are so notable for their reliable, easy-to-understand guidelines and fairness in taking on cases – respectively – there’s no way he could have been screwed.

      Maybe he is a crook; I don’t know. However, I could easily see a scenario where someone makes a decision to code a certain ailment as requiring $921.44 worth of care, and some bureaucrat comes along and decides that 11.8% of those cases really only needed $377.63 worth of care, and were therefore fraudulent.


    3. You really are a shaved sasquatch, aren’t you?

    4. Those damn Southerners, you can’t trust ’em.

      You bigoted shit.

      1. Well, Southern politicians are unusually crooked. Not Illinois crooked (except Louisiana) but pretty crooked nonetheless.

  5. If Vermont goes single-payer the way they say they will if Obama gives them their waiver, I am totally going to use lots of health care so you fuckers get stuck with the bill.

    1. To say nothing of all the people in NH and MA who will drive there for free care. Someone should ask the 3 remaining Vermont taxpayers how they plan to pay for all of it.

      1. Vermont’s loaded with industry that can afford it. Just look at my parents, they have a successful….dairy farm.

    2. waiver or not, fluffy & pablo can still go to the ER for that good ol free health care.

      1. I’ve been to an ER while uninsured. It ain’t free you blooming idiot. They bill you and everything.

        But you knew that, didn’t you?

        1. billing n paying’s 2 sep things. but u knew that didnt u?

          1. “billing n paying’s 2 sep things. but u knew that didnt u?”

            Says the sleaze-bag.

            1. sevo|3.2.11 @ 3:54PM|#
              “billing n paying’s 2 sep things. but u knew that didnt u?”

              Says the sleaze-bag.

              What do you expect from a thief?

      2. I’ve never said anything about “free health care.” There ain’t no such thing–someone has to pay. And I think EMTALA was a terrible law.

    3. I hope Vermont does go single payer. Things will be even more fucked up there than in Mass.

    4. I’ll swing back into Burlington and we can do a Church Street challenge till we need to get our stomach pumps.

  6. When pressed for an explanation of why the administration opposes block grants, Berwick declined. “That’s all I have to say about that right now,” he said.

    Off with his head! That’s all I have to say about that right now.

  7. there once was a girl from Brighton
    whose boyfriend said “my that’s a tight one”
    she said “you poor soul,
    you’ve got the wrong hole,
    but there’s plenty of room in the right one!”

    1. There once was a man named Dave
      who dug up a whore from her grave
      she was moldy as shit
      and missing a tit
      but think of the money he saved!

      1. there once was a man from Peru
        who fell asleep in his canoe
        while dreaming of Venus
        and playing with his penis
        he woke up with a handful of goo!

        1. There once was a man from Calcass
          Whose two balls were made out of brass
          In stormy weather
          They clanked together
          And lightning shot out his ass.

          1. There once was a man from Nantucket…
            oh you’ve heard that one.

  8. You know what else we should do this with? Funding…wait for it…roads.

  9. When pressed for an explanation of why the administration opposes block grants, Berwick declined

    It’s all about control, baby! Control!

    I love the way you look at me

    I love the way you smack my ass

    I love the dirty things you do

    I have control of you

  10. Hey, if I put on a white lab coat and hang a stethoscope around my neck, can I call myself a doctor and hang around with Obama too?

    1. they dont wear that stuff in kenya

      1. i just poopied in my pants lol

  11. When pressed for an explanation of why the administration opposes block grants, Berwick said, “Why? You want to know why? I’ll tell you why. Fuck you, that’s why.”

    1. Was he carrying a baseball bat when he said that?

    2. Maybe he had a Mohawk and said “You looking at ME???”

    3. Berwick will be one of the first to get the tar and feathers when the revolution comes…oh was that uncivil ?

      1. Berwick will be one of the first to get the tar and feathers when the revolution comes…oh was that uncivil ?

        Not uncivil, but Sebilius and Salazar first. Then Dr. Berwick.

  12. Alt text:
    “Obama listens to doctors discuss economics”

    How come they don’t ask cobblers whether the government should pay for shoe repairs?

    1. Don’t you remember all those auto mechanics he had over to the White House for lunch when preparing the “Cash for Clunkers” program?

    2. I like that pic..he’s so serious. Pondering the issues. cause he’s so smart you know.

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