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mum
umsomr mama on WA]. arm-nous
mmucon. n. c. 20375
(202) 382-2116 YOK A. ll. RELEASE
Septeoher 30. 1968
NEWS EMS
NATIONAL oomxssmm ounces Ill 016510
The Advlaory autumn on Intergavernneatal Relatlona. ant-nun;
M
m San Francuco September 20, recon-ended "adherence to the goala ol
um Congrvuluml cstahllshed FederaloState Hedicald prugramo-cuupn-o
lit-halve m'dlcal care (or "subatuntlallgnll" ol the poor and near poor
by l975~hut pruposed IeVeral laportant change- la the my the progra-
nuw u operated. The Cont-awn also urged the Federal Government
cu take account of the heavy rum burdens posed on State and local
govern-ants by the program and to consider hroadenlng mdlceld'a
flmmclal been through lurcnud lmmlveacut of the prlvate acvtur
through an employeroe-ployec cuntrlhutory health lnsurancc uystcn ur
uther appruprlatc loans.
Parrl. Bryant. Gunman ul the leeory (Jo-lesion and (umr
Governor ul Florida and. "the report identitiea clu- any point 01
undo rchaled durln the that two and a half years 01 Htdlcald'e
nporatlon. and often maya 0! eaaln; than, conuent ulth euvctlsm
and cccmollcal Iodical care." a When *3 c .J
50-? why-mus m arkJ W .
The 26- r Co-iaewu Le a bi artisan body eatahllahcd by
Federal law lu l959 to ulntaln continuing review 0! the rulutluns mum;
Fl'dtrdl. State and local govern-antes. It: holdup consul. ol
gutvvt'nuta. mayors. county olllclaln. State legislature. am! representa-
twon of both lbusva a! Gangrene. the Federal Emcutlu- branch. and the
general puhllc. luster: Roster u! Marlon mama-re attachch
(more)
The Advisory Go-lasion proposed that the Federal Oman-cot
nako liodicald noncy available to States for coverage of scan groups of
needy not: excluded; that States be ivcn unto exibility in adapting
the Medicaid program to their individual needs and resources; and that
Statnmrwith allowing vdicaid applicants to use a ainplo
declaration at nancial status in csublishin tiwir financial
eligibility. The dominion opposed any attonpt by the Indoral Government
to who such a declaration Procrdurv mandatory. Mower.
Tho Omission's study of liodicaid located mainly on basic
pollen-u .uivcting rvdorul. Stutv and local sharing of rt-aponaibility
iur iinancin; around. It accqlla Micah! as an interment-natal
program [or providing medical can. in the noody and udicnlly needy-on
Joint program in which iinnncing cones basically from public land. and
eligibility for services is based on a "means test." in so confining
the stody's scope, Clair-an Bryant said that the (mission inpliu no
pinion on tin.- ncrits and dent-vita o! najor altcmtivo uyutmx. of
financing nodical care ior the noody and sonically noudy.
Anon; tho significant findings and conclusions of the report
are tho following
0- Policy-Mrs at all xovorn-cntal lchla new largely unpreparod
(or the manitudo oi the fiscal inpact of Medicaid. The progan
has tripled federally aliltfd nadical Vendor pay-cats iron
(pore) .
-3-
$1.4 billion in 1965 to an eetimeted $4.2 billion in
fiscal year 1968-69.
-- A; a consequence of thin impact. Congress in 1967 imposed
limits on Federal sharing in the cost of medical care for
the medically needy. These cutbetke forced ebout a dozen
States to restrict the number of eligible: covered or make
other program adjustments.
-~ For the Staten. the first two end a half yeare of hediceid
produced a wide verietion in the scope of the program and its
fiscal impact. Thirty-eight States had initiated the progran;
12 and tau District of Columbia had not. Thirteen of the 33
States had progrems for the needy, but not for the medically
needy. Seventeen provided some degree of at least 11 of the
la medical services specified by law for hath the needy and
medically needy. For 27 Nedicaid States with programs in
effect for ell of 1967, the change in total medical vendor pey-
nente between 1965 and 1967 varied from an increase of 371 per-
cent in Delaware to a decline of 15 percent in west Virginia.
with an average increase of 56 percent.
- In a few States new or higher State level taxes were linked in
part to Medicaid programs; in others, higher taxes were fore-
stelled by postponing initiation of a Xcdicaid program or by
restricting the program's scope.
(more)
- a -
-- A key contributor to the rising curve of Hedicaid expenditures
was the increase in medical costs. Medical prices increased
6.6 percent in 1966 and 6.4 percent in 1967, compared to rises
of 3.3 and 3.1 percent in the overall consumer price index.
-- Among the nonfiscai problems in the Medicaid program most
concerning the States are difficulties in coordinating the
administration of Medicare and Medicaid, the inflexibility
o! the law and guidelines, and difficulties in imposing
adequate controls over charges for services.
The Commission found that the legislative history of Medicaid and
tongressional attitudes toward further cost escalation of the program
raise doubts about the strength of the Federal Government's commitment
to the law's requirement that the States provide comprehensive care to
"subntuntially all the needy and medically needy by July 1975. The Commission,
howevor, endorse the 1975 goal. At the same time, a two-year postponement
of Metieaid's 1970 target date [or all States to initiate a program was
rm outm- th-d .
The Commission also called (or shifts in the sharing of fiscal
tcspnniblllty among Federal. State and local governments. It urged:
-- greater State discretion in determining lien and recOVery
provisions; and
- tighter Federal standards (or evaluating State limitations on
the amount of cash assets they allow Medicaid recipients to
retain.
(more )
- 5 -
The Commission rejected'proposals to put Hedicaid on a i.-~ n-Vnd
appropriation basis and Ch mandate nationwide eligibility standard .u:
recipients. in connection with the latter, however, greater intvrhitv
uniformity in eligibility requirement; was supported an n lonh-r. goal.
Reflecting concern over the need to control xedicaid costs, the
Commission recommended that the Secretary of HEW rescind regulations
requiring hospital inpatient services to be reimbursed under Mr. -.u
on the same basis as under Medicare, thus avoiding imposition oi an
uneconomital "cost-plus" feature on Medicaid. It also urged the States
to move vigorously to experiment with methods of increasing LlC o:.lricncy
and economy of health services under Hedicaid. Suggested technieuvn include
reimbursing hospitals contingent on their efficient upcraiiun, expandinb
prior Juihorilltin for elective surgical procedures, basing payment [or
physician~ services on other than "usual and customar," chhtgca, an. Una
of copaynuni or "deductible" provision.
in order to give States greater flexibility in developing a
program a: nwdical services for their needy and medically needy within
limitations of State resources, the Commission propoSed that, suoicet to
approval of the Secretary of NEH, States be allowed to vary schlscS among
different groups served.
Finally, the Commission urged States to move vignr.quy to
experiment with simplified procedures for establishing Lodau-Li Quail i-a-
tiuns for medical assistance under Medicaid, designed to remove the
administrative complexity and the stigma attached to the prehcn. austem oz
establishing applicants' financial status. The Commission lu{.-ci
(more )
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recounendod that State Indical autatanca ottlctala be 31m: awe. .uwct
safeguards. to Padatal into-a tax retuma for purposea o! verifying
applicant a atatananta.
(NOTE: A digest of the recommendations adopted at the
Septuaer 20 mating la attached.)
(end)
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Statt Eledicdt a:.sisi-Lth-e oliigials "g.. n TGL ral irteim Lax rg: urns for purposes 01 --in-ItLN. .d .ge'.sL 0-. Lht. rec.>nire.idatiG[ts adapLed at ep[eln0er 20 rootirse is attached.
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