Medicaid tinkering threatens those with least

NPR reported today that South Carolina, Georgia and Florida are tinkering with proposals to save money on Medicaid by changing how money is delivered. Instead of the current structure of providing service for fees, proposals would essentially give users a stash of cash to get private health care.

In effect, these market-driven proposals seek to set up Medicaid as a system of private accounts. From NPR:

Backers say making patients more responsible will lower overuse of services. But patient advocates say the sickest people will quickly run out of money and be left even worse off than before.

The Center for a Better South's Andy Brack wrote about the dangers of Medicaid privatization in his weekly SC newspaper column on Sunday:

More than 700,000 South Carolinians may be used as guinea pigs to see if the marketplace can lower costs in providing health care. Gov. Mark Sanford and the folks at the state Department of Health and Human Services requested a waiver from the federal government in June....

Critics say the Sanford salvation is still half-baked. One of the biggest reasons is, "The proposal rests on untested assumptions, such as the belief that a system of managed care plans and provider networks will rapidly emerge in the state to serve Medicaid beneficiaries," according to the Center on Budget and Policy Priorities.

In a scathing report, the Center described the Sanford plan as a radical way that seeks to privatize Medicaid. "For beneficiaries - - the vast majority of whom have incomes below the poverty line - - the result would be much less health coverage at considerably greater cost. Private plans would not be required to provide the range of benefits now offered under Medicaid. All beneficiaries, including pregnant women and children, would face a significant increase in out-of-pocket costs for health care."