Medicaid -- AIDS Impact of Proposed Cuts

On April 29 the San Francisco AIDS Foundation issued an action alert asking people to call their Congressional representatives, and members of the House and Senate budget committees, to oppose cutting Medicaid funding, and oppose "per capita caps" on Medicaid (which would limit Federal reimbursement to states to a flat rate for providing medical care for poor people with disabilities, regardless of individual differences in the cost of their care).

On May 1, the AIDS Action Council in Washington sent a separate alert on this issue.

The following is from the San Francisco AIDS Foundation:

"* Medicaid is the single most important program serving people with HIV. Seven of ten dollars spent on AIDS care come from Medicaid [Medi-Cal in California]. Medicaid provide health care to more than 90% of children living with HIV and roughly half of adults with AIDS.

"* Cutting Medicaid is not necessary. The Congressional Budget Office (CBO) has forecast, as of January 1997, that future Medicaid spending has fallen to $618 billion over the1998-2002 period. This is below Republican proposals in 1996 for $626 billion in Medicaid spending over the same period as part of their balanced budget proposal. It is also far below projected Medicaid spending in the President's initial budget proposal of December 1995.

"* Per capita caps will squeeze Medicaid AIDS care. People living with HIV comprise less than 1% of all Medicaid beneficiaries and their health care expenses make up only 2% of total Medicaid costs. Nonetheless per capita caps which are based on paying state Medicaid programs on the basis of average costs for all people with disabilities would unfairly target people with AIDS and others with extensive healthcare needs. The average cost of care for a person with a disability in Medicaid is approximately $8,000/year. Without protease inhibitors or other new drugs, the average cost of care for a persons with AIDS exceeds $20,000/year in many locations. If states are reimbursed from the federal government on the basis of only the initial $8,000, then state Medicaid programs would seek ways to limit Medicaid eligibility for people with HIV/AIDS and they would seek ways to limit necessary health care services to people with HIV/AIDS in the program. ..."

"Negotiations between the President and Congress over a balanced budget agreement continue. It is possible that adeal could be struck in the next few days and it is also possible that they could fail to reach a deal at all. Cutting Medicaid is not necessary to balance the budget. The HIV community needs to weigh in forcefully at this time to let Congress know that cutting Medicaid would limit access tocare for people living with HIV. Further cuts to Medicaid are unacceptable.

"The San Francisco AIDS Foundation opposes the President's proposal to cut $22 billion from Medicaid (over 1998-2002) and his plan to institute per capita caps ... While the President has also proposed $13 billion in new Medicaid spending, which we support, to help mitigate harmful effects of the welfare reform legislation that he signed, they need not come at the expense of current Medicaid beneficiaries.

"Some Republicans in Congress are countering the President's offer by proposing to accept the President's $22 billion in cuts, but without his new spending proposals. Consumers need to provide a countervailing voice in Congress to the President's and Republican calls for harmful changes to Medicaid."