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          Front Page


Thursday, January 30, 2003

Medicaid Bills Make Way Into Session

By Winthrop Quigley
Journal Staff Writer
    SANTA FE Nine months of effort to reform Medicaid culminated Wednesday in the introduction of six bills by a bipartisan group of state senators.
    The legislation, if enacted, would over time appropriate $20 million from funds generated from the settlement of the state's litigation against tobacco companies; raise up to $105 million from additional cigarette and alcohol taxes; and implement a number of Medicaid program changes that proponents say would reduce state spending on Medicaid by up to $22.5 million.
    Similar legislation will be introduced today in the House, said Rep. James Roger Madalena, D-Jemez Pueblo, who was co-chairman of the Legislature's Medicaid Reform Committee. The committee was established during last year's legislative session when lawmakers and then-Gov. Gary Johnson could not agree on how much to spend on Medicaid.
    The program, designed to provide health care primarily to low-income children and poor adults, is expected to cost the state $380 million in the fiscal year that ends in June. The program is expected to be at least $40 million over budget.
    At a news conference in the Roundhouse, committee members also challenged criticism that the committee had not dealt with cutting program costs by reducing benefits or limiting eligibility for Medicaid.
    "Instead of a chain saw, we used a scalpel," said reform committee co-chairwoman Sen. Dede Feldman, D-Albuquerque.
    Committee members argued that cuts in the program should be a last resort after the state tries to find new sources of revenue and improves the federal government's contribution to Medicaid. The federal government matches each state dollar spent on Medicaid with about $3.
    Feldman acknowledged that Gov. Bill Richardson has opposed the committee's cigarette tax proposal and has other plans for the tobacco settlement money.
    "I'm hopeful we can come together," she said. "It may not be in this session."
    Senate Minority Leader Stuart Ingle, R-Portales, who served on the reform committee, warned, "We didn't have to use a machete this time. We used a scalpel, but we may be getting up to using a pocket knife before long."
    The legislation introduced Wednesday would:
   
  • Appropriate $20 million in tobacco settlement program funds in the next fiscal year to pay for Medicaid. (SB 324)
       
  • Impose a premium tax on the revenue HMOs collect to provide care under Medicaid. Though the state would reimburse the HMOs for the expense, the federal government would match the reimbursement with an estimated $22 million in new funds. (SB 331)
       
  • Allow taxpayers who purchase long-term care insurance to take a state income tax credit equal to 25 percent of the insurance premium's cost. (SB 337)
       
  • Implement program changes, including techniques designed to lower the state's cost of purchasing prescription drugs for Medicaid patients. Other changes would improve disease management and improve Medicaid fraud detection. (SB 338)
       
  • Raise cigarette taxes by 60 cents a pack. (SB 336).
       
  • Fund cost-benefit analyses on a variety of Medicaid issues, including changing HMO delivery of Medicaid health care to a "primary care case management model." The legislation requests $500,000 for the studies. (SB 332)