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Proposed Senate Health Care Cuts Will Reduce Health Care Access for All Michigan Citizens

LANSING, Mich., June 16 /PRNewswire-USNewswire/ -- Proposed Senate cuts of more than $200 million in general fund support for Medicaid could reduce access to health care for many Michigan families and raise costs for everyone if the Senate budget recommendations are adopted by the state House and the governor. Combined with the loss of federal matching funds for Medicaid, the cut to health care could grow to more than $600 million, according to The Partnership for Michigan's Health.

The Partnership, which includes the Michigan State Medical Society (MSMS), the Michigan Osteopathic Association (MOA) and the Michigan Health & Hospital Association (MHA), urges the Senate to reconsider the proposed cuts and use the federal stimulus health care dollars as they were intended: to maintain the safety net for a record-high 1.7 million residents who rely on Medicaid for their coverage.

Members of the Partnership agree that it's simply not good public policy to cut health care at a time of skyrocketing Medicaid enrollment and unemployment, a statewide physician and nursing shortage, and increasing co-pays and deductibles which are leading residents to delay their care while their conditions worsen.

The Senate Appropriations Subcommittee on the MDCH recommended the following cuts pertinent to Michigan hospitals and physicians:

  • 8 percent cut to hospital and physician rates
  • a similar 8 percent cut to all other Medicaid providers
  • elimination of adult Medicaid optional services (chiropractic, podiatric, dental and hearing)
  • $10 million in savings that the MDCH is instructed to produce from Medicaid co-payments and premiums

An 8 percent cut to hospital inpatient and outpatient rates will result in lost funds totaling more than $112 million ($32 million in general funds and $80 million in federal matching funds).

"We understand that the state is in a financial crisis, but further cuts to Michigan's already grossly underfunded health care infrastructure will cause real, human suffering in every one of Michigan's 38 Senate districts," said MHA president Spencer Johnson. "Cuts should not be made that cause human pain. All of our state senators must acknowledge that health care is not just an important function of state government, but an essential one."

"With additional cuts, hospitals may be forced to eliminate programs and reduce services which will affect everyone in a community," Johnson said. "There is no place left to 'trim the fat.'"

Also troublesome is the resulting loss of federal matching dollars from the cuts. For every $1 Michigan spends on Medicaid, the federal government sends an additional $2.33 to the state. So for every $1 the Legislature cuts from Medicaid, Michigan patients and providers lose $3.33 in essential health care funding.

"These federal matching funds are crucial to the ability to provide health care to Michigan residents," said Johnson. "Cutting Medicaid means leaving federal matching dollars on the table."

"Medicaid is not the place to make cuts," echoed MSMS president Richard E. Smith, MD. "Medicaid cuts will make it harder for many Michigan children, the elderly, and the disabled to access health care, and that is unacceptable."

Dr. Smith pointed out that "declining Medicaid reimbursement affects health care access not only for Medicaid patients, but for every patient in Michigan because when a physician leaves a community or hospital services are eliminated, that care is lost to everyone."

"Despite an estimated $2.2 billion targeted to Medicaid in federal stimulus funding over 27 months, the state Senate is proposing to cut provider reimbursement by 8 percent which is a stunning disregard for the health of Michigan residents," said MOA executive director Dennis Paradis. "Additional Medicaid cuts will erode Michigan's health care delivery system and further constrain access to care at a time of Michigan's greatest need," said Paradis.

"The unintended consequences of these cuts will continue for decades," Paradis said. "All patients will find it more difficult to access health care and the physician shortage in our state will be exacerbated. Physicians and hospitals are asking state leaders to protect health care access for all."

The Partnership acknowledges that the state is in dire financial straits, but cuts to Medicaid will harm people, abandon federal funding, and further destabilize the state's fragile health care system.

SOURCE The Partnership for Michigan's Health
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