Suggestions to better health care for Missourians

Legislators attempting to balance Missouri's budget are confronting a daunting task when it comes to the state's Medicaid program. Medicaid is a state-federal program designed to meet the health care needs of some of Missouri's most vulnerable populations. The primary populations served by Medicaid include:

Nearly 182,000 elderly and disabled Missourians, of whom 158,000 (87 percent) are dually enrolled in Medicare and Medicaid. These beneficiaries enroll in Medicaid to obtain nursing home care and prescription drug benefits because Medicare does not cover these necessary services for the elderly. Elderly and disabled beneficiaries cost the state's Medicaid program more than $15,000 annually per beneficiary, or $2.8 billion in total federal and state funds annually. This group represents only 21 percent of all enrollees in the Missouri Medicaid program but 68 percent of the program's total expenditures.

Approximately 80,000 children enrolled in the federal State Children's Health Insurance Program. In state fiscal year 2002, these children cost about $1,100 per beneficiary, or approximately $82.2 million in total federal and state funds. The federal government has created special incentives, such as an enhanced match rate of 72 percent federal dollars and 28 percent state dollars, to encourage states to insure their SCHIP populations. In fiscal year 2004, Missouri will receive nearly $70 million in federal funding for its SCHIP. If we fail to participate in SCHIP, Missouri's dollars will be reallocated to other states.

Nearly 615,000 low-income adults and children eligible under other Medicaid categories. In state fiscal year 2002, these enrollees cost about $2,000 annually per beneficiary, or $1.2 billion in total federal and state funds.

As these numbers clearly demonstrate, Missouri's elderly and disabled are a very expensive population to insure, while Missouri's children and their parents and caregivers are relatively inexpensive to insure.

The many positive outcomes achieved under SCHIP further demonstrate the value of investing in children. Data from the Missouri Department of Social Services and the Missouri Department of Health and Senior Services shows children in the SCHIP program experienced a:

39 percent decrease in missed school days.

30.5 percent decrease in preventable hospitalizations for children.

22.6 percent decrease in emergency room visits for children.

As a result of SCHIP and other expansions, Missouri has reduced its uninsured population to below the national average. Based on three-year averages for 1999 to 2001, Missouri had the seventh lowest percentage of uninsured residents among all the states.

We offer the following recommendations for consideration:

Enhanced care management for the elderly and disabled. Missouri has introduced limited care management concepts into the delivery of services to its elderly and disabled populations. After careful study of the issues, Missouri's hospitals are proposing to join the state in enhancing care management for the elderly and disabled. Such care management would include follow-up contacts by nurses to make sure beneficiaries have appropriate support to remain in their homes, when possible, and to avoid hospital readmissions and unnecessary emergency department visits. The Missouri Hospital Association estimates such enhanced care management would save at least 1 percent of the Medicaid cost of the elderly and disabled, or $28 million annually. We recommend these funds then be used to continue Medicaid coverage for Missouri's children.

Federal government assuming costs of prescription drugs for elderly and disabled. We further suggest that the federal Medicare program assume responsibility for the prescription drug needs of Missouri's dually eligible Medicaid and Medicare beneficiaries. This action alone will save the state approximately $166 million annually. These funds could be used to fund continued coverage for parents and caregivers of these children.

Revising the budget process to report the costs for insured populations. Finally, we suggest that Missouri's budget process be reorganized to focus on the appropriations necessary and the cost related to each of its insured populations: the elderly and disabled and children and their parents and caregivers Legislators must focus on the comparative costs of these two populations before making drastic cuts affecting either vulnerable population.

Missouri's hospitals are committed to working with legislators as they make these tough choices. We are an integral part of the process; Missouri's hospital provider tax generates almost 72 percent of the state's share of funding the Medicaid program for children and adults. The state's hospitals remain dedicated to their partnership with the state and its Medicaid program to improve the health status of all Missourians at a price we all can afford.

Dwight L. Fine is senior vice president for governmental relations with the Missouri Hospital Assocation.