Simultaneously Reforming NM Health Care and Filling the Budget Gap

On Monday, the Albuquerque Journal reported that policymakers are considering cutting Medicaid in order to shore up New Mexico’s budget deficit. All I can say is that it is about time. New Mexico’s Medicaid program has been in dire need of reform for many years now. In fact, Michael Cannon of the Cato Institute — he is going to be taking the free market position in our upcoming health care debate on Monday — visited New Mexico a few years back and discussed several reasons to reform Medicaid. Also, Drs. Harry Messenheimer and Kenneth Brown discussed potential Medicaid cost savings in a policy paper published back in 2003.

Lastly, Stephen Moses who runs the Center for Long Term Care Reform has put together a document entitled “How to Save Medicaid $20 Billion Per Year AND Improve the Program in the Process.” The document should form the basis for reforming Medicaid as it relates to long term care. As moses points out:

· Medicaid LTC recipients consume a disproportionate share of total program
expenditures. For example, consider people eligible for Medicaid AND Medicare.

· Such “dual eligibles” account for 42 percent of Medicaid spending, although they
comprise only 16 percent of Medicaid recipients.

· Dual eligibles are heavy users of long-term care and acute care services not covered by
Medicare. And Medicaid pays for their Medicare premiums and cost-sharing too.

The point is that Medicaid is a ripe target for cost savings and reform. Hopefully legislators will look at some of these “big ideas” rather than just working around the edges. Who says that you can’t enact successful health care reforms at the state level?