Report: Medicaid Proposals Pose Threat to Mental Health
Safety Net
Individuals Harmed and States at Risk of Later Increased
Costs
Washington DC, June 6, 2003—Proposed changes in
the federal Medicaid program “could have immediate and devastating
consequences for Medicaid recipients with mental illnesses,” according
to a new report by the Bazelon Center for Mental Health Law, at the same
time “increasing overall state, local and federal spending.” The
Bush Administration proposed sweeping changes to Medicaid in January
and a task force of the National Governors’ Association is now
considering a similar proposal.
In its report, Making
the Right Choices, the national advocacy group documents Medicaid’s
importance as a “the single most important source of revenue
for state mental health systems.” About 10 percent of the 37
million low-income people on Medicaid use mental health services.
The report analyzes the impact on people with mental
disabilities of several approaches that have been proposed for reducing
federal Medicaid expenditures:
--The new proposals on the table would convert the Medicaid
entitlement to a grant program with capped federal funds. Medicaid currently
provides an average 57 cents of each dollar states spend for services
to eligible recipients. If health costs increase or more people become
eligible-as a result of unemployment, for example- the report points
out, states would then be forced either to pay up to 100% of the cost
or deny services.
--Under these proposals some or all covered recipients
would be shifted to a benefit package modeled on private insurance. However,
private insurance plans are particularly limited in mental health coverage.
The report cites experience with this model in the State Child Health
Insurance Program (S-CHIP), showing that this approach would eliminate
access to many of the most effective rehabilitative services now available
to adults and children with serious mental disorders and, in many cases,
constrain mental health care below effective treatment levels.
--One stated purpose of the proposed changes is to free
up funds to cover currently uninsured people by creating a separate program
for some Medicaid recipients (those covered at states’> option).
This program would have fewer benefits and higher co-payments than Medicaid.
Nearly 4 million low-income adults, 4 million children and 1.5 people
with disabilities would lose benefits they now have. The report cites
evidence that these individuals have a greater need for mental health
services> than non-Medicaid populations and asserts that reducing
their benefits to cover more of the uninsured “is neither cost-effective
nor humane.”
“ Medicaid can, and should, undergo some reform,” the
report concludes, but such “blunt policy instruments...are misguided.”
The Bazelon Center proposes some improvements that would
assist both states and beneficiaries. These include more flexible Medicaid
service definitions, allowing states to fund integrated community-based
programs that encourage recovery and facilitate redirection of funds
from institutions. Medicaid could also improve eligibility criteria to
cover some single adults who are now excluded, the report notes. This
would not only provide a more effective safety net for many individuals
but also save states some of the dollars now spent on homeless services,
jails and hospitals.
“ This is not the time to pull the financial rug
of Medicaid out from under public mental health systems,” the report
concludes, quoting the observation by the President’s New Freedom
Commission on Mental Health in its interim report that “these systems
are already ‘in shambles.’”
To order printed copies of the 18-page issue brief, Making
the Right Choices, send $5 (includes postage) to Publications Desk, Bazelon
Center for Mental Health Law, 1101 15th Street NW, Suite 1212, Washington
DC 20005 or make
a secure online purchase.
- 30 -
The Bazelon Center for Mental Health Law is the
leading national legal-advocacy center representing people with mental
disorders, working to protect and advance the legal rights of adults
and children with psychiatric or developmental disabilities and ensure
their equal access to the services and supports they need for full
participation in community life.
|
