Governors Call on Congress to Cover Dual-Eligibles

Illustrating the strain of health care costs on state budgets, the nation’s governors on Friday (8/1) unanimously called for the federal government to assume responsibility for the more than 6 million poor, elderly Americans ‘dually eligible’ for both Medicaid, the state-federal health care program for the poor and disabled, and Medicare, the federal health insurance program for the elderly.

In an Aug. 1 letter, addressed to U.S. Rep. Bill Thomas (R-Calif.), chairman of the House Ways and Means Committee, the governors called dual-eligibles their “highest priority” for Medicare legislation: “We strongly support this specific provision in the House bill that gives elderly and disabled Medicaid beneficiaries full access to the new Medicare prescription drug benefit.”

Congress will reconvene after Labor Day to continue hammering out a final version of a Medicare bill that would provide federal prescription drug benefits for seniors. Both the U.S. House of Representatives and Senate passed different versions of a Medicare overhaul bill June 27.

States are critical of the Senate version for excluding the dual-eligible population, but until recently they had not formally endorsed a House provision that would slowly phase out the state’s financial responsibility over a 15-year period. The Bush administration is urging members of Congress to wrap up negotiations as soon as possible.

In a National Governors’ Association press release, Florida Gov. Jeb Bush (R) said: “Despite income status, these seniors are Medicare beneficiaries first, and should be afforded equal access to a new prescription drug benefit. All seniors should enjoy the security of this benefit.” Kentucky Gov. Paul Patton (D), who chairs the NGA, told reporters in a conference call Monday (8/4) that if a dual-eligible provision was not included in final legislation, it will only exacerbate the Medicaid crisis in states and might prompt states to make further program cuts.

“I believe that many states have reached the point where we simply cannot provide more funding for the Medicaid program, so cuts are the only way you can deal with that crisis,” Patton said.

States collectively spend $40 billion annually on the dual-eligible population, and of that $7 billion is allotted for prescription drug coverage, according to NGA data. Over the next 10 years, states will spend an estimated $100 billion on drug coverage for this type of enrollee, according to the Kaiser Commission on Medicaid and the Uninsured, a research arm of the Washington, D.C.-based Henry J. Kaiser Family Foundation. States are not required to provide a prescription drug benefit under Medicaid, but all do and governors are worried that other health care services will suffer further cutbacks, due to rising health care costs, increased Medicaid spending and other budget woes.

“If the federal government doesn’t take over this (dual-eligible) population then states will basically have to cut back services to women and children, which are the optional beneficiaries,” NGA executive director Ray Scheppach said.

Though no one is certain how the Medicare drug debate will play out on Capitol Hill, Patton said the governors are “pretty optimistic” the provision will be included.

“With 50 governors taking this position we believe that the (congressional) conferees will listen to that … They’re very aware of the fact that states are facing their greatest fiscal crisis in 50 or 60 years,” Patton said.