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Successful Medicaid Reform Under Threat

AP
• August 28, 2013 12:03 pm

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Rhode Island’s Medicaid reforms might not be renewed, potentially causing costs to rise again, according to an editorial in Wednesday’s Wall Street Journal.

The Bush administration granted Rhode Island’s Republican governor a waiver from federal Medicaid regulations in 2009 in exchange for cap on money the federal government would give to the state’s Medicaid program.

Rhode Island implemented two significant reforms to its health insurance program for the poor, according to the editorial:

The first reduced costly emergency room visits by Medicaid recipients for routine medical needs, and the second reduced admissions to pricey nursing homes by offering home-care subsidies and promoting assisted living arrangements, which seniors generally prefer.

Before the reforms, Rhode Island’s Medicaid costs were rising 7.6 percent each year on average, far above the national average.

But after the reforms, costs for the program overall only rose 1.3 percent each year between 2009 and 2012. Costs per enrollee actually dropped from $813 to $770.

However, despite the reforms’ success, President Barack Obama and Secretary of Health and Human Services Kathleen Sebelius are not likely to renew the waiver that allowed the reforms to take place when it expires next year:

President Obama says he favors "what works," but on health care his ideology always trumps common sense.