Governor Dirk Kempthorne: Comments at Cover the Uninsured Week

GOVERNOR DIRK KEMPTHORNE
Comments at Cover the Uninsured Week
Proclamation Signing
J.R. Williams Building
March 10, 2003

Thank you for inviting me to be here, today. Before I sign this proclamation, I'd like talk for a few minutes about what I see as a significant opportunity for states to begin addressing the issue of the uninsured.

As many of you are probably aware, President Bush recently presented his budget, which included major reforms in the Medicaid program. The President's plan will provide flexibility to the states to design a health care delivery system that meets the needs of beneficiaries today and into the future.

Central to Medicaid Reform is the ability of states to keep the federal money it saves through efficiencies and better plan designs.

Under the current system, for every three dollars we save, we send two back to the federal government. There is no incentive to be innovative.

Under President Bush's initiative, the states will no longer be penalized for innovations and reforms that produce savings. We would be able to keep that portion of federal money that would otherwise be sent back.

That money would go a long way in helping us address the uninsured.

In Idaho, through Medicaid, we spend nearly $1 billion providing medical and other care for approximately 150,000 individuals.

Since its inception in 1965, the Medicaid program has grown too large and cumbersome.

Medicaid is intended to serve four basic groups:

children;
pregnant women;
the elderly; and
the disabled.

But with Federal regulations, there are 37 different eligibility classes that must be administered by the Department of Health and Welfare and reported back to the federal government.

Let me give you an example of the complexity of the problem. The Federal Government defines one of those eligibility classes with the following:

"Individuals who would be eligible for Aid to Families with Dependant Children (AFDC) except for the 20% increase in Social Security benefits in 1972, provided that, in August of 1972, they were entitled to Social Security and were also receiving cash assistance. Included are: (a) individuals who would have been eligible for cash assistance in August of 1972 if they had applied; and (b) individuals who would have been eligible for cash assistance in August of 1972 if they had not been in a medical institution or intermediate care facility."

We have employees whose only job is to interpret these rules…and let me tell you that their workload has only grown in the past 35 years.

Under the President's new plan, states would have the ability to simplify the whole system. Instead of spending time and money on interpreting arcane federal rules and filling out endless reports for the federal bureaucracy, we can spend that money on real people who have real needs.

States would also have the ability to redesign benefit packages, so that we could take additional, meaningful steps toward a health care delivery system that emphasizes primary and preventative care and helps us avoid costly trips to the emergency room.

We could make significant progress toward more consumer-directed care, especially for our disabled and elderly populations.

It is time that we rebuild a crumbling system. Medicaid and Medicare are dinosaurs that cannot keep up with the growing demands of our society. And as the baby boom generation ages and comes to depend on Medicaid and Medicare, these programs will ultimately fail.

As we redesign Medicaid, I sincerely believe that we have an opportunity to make changes that will help us responsibly address the needs of uninsured Idahoans.

And as evidence of our efforts to help the uninsured, we can look at our success in covering uninsured children. Over the past four years, we've gone from 50,000 to over 100,000 now covered.

Over the next several months, I will be working closely with Secretary of Health and Human Services, Tommy Thompson, to ensure that the system put into place at the federal level provides the flexibility for states to meet the needs of their current populations, as well as potential new populations.

Now, while we're talking about Medicaid, and the state's ability to respond to currently un-covered groups, I think it important to talk about what's happening across the street in the Statehouse.

As you all are aware, Idaho, like every other state, is facing the affects of a national recession. In my State of the State Address, I proposed a path forward that protects the essential services of government.

For the past two years, we have cut, cut again, and then cut some more. We are now to the bone and I'm not willing to amputate.

As the Legislature continues its deliberation on my plan forward, they have also explored alternate ways to balance the state's budget.

Recently, the Department of Health and Welfare was asked by members of the Senate to present the impacts of a 7.1% cut in FY04. In Medicaid, that means a cut of nearly $30 million from my proposed budget.

What does that mean for beneficiaries? It means that about 20,000 individuals will see their services dramatically cut or completely eliminated.

When you consider that many providers in rural areas rely on Medicaid to keep their doors open, you will likely see tens of thousands more lose services because the providers have closed shop.

These cuts are unacceptable to me and I believe they're unacceptable to Idahoans.

The Legislature is working through this. They're beginning to understand the impact that these cuts would have on our citizens and I am convinced that we will ultimately agree on the path forward.

While other states have cut entire populations from their Medicaid roles, I'm proud of the fact that Idaho has not had to eliminate eligibility for anyone.

We must continue to fund these vital services. We must continue to make progress toward addressing the uninsured in Idaho. And as we reshape Idaho's Medicaid program, we must work to create a system that will meet the needs of Idahoans today and into the future.

I commend each of you for participating in this town hall meeting. And, I look forward to exploring innovative ways to address the needs of Idaho's uninsured.

I will now sign this proclamation which designates this week as "Cover the Uninsured Week."

Thank you.