Financial crises make Medicaid programs vulnerable

Financial crises make Medicaid programs vulnerable


WASHINGTON—With 49 of 50 states facing serious budget crises this year, AARP today called on Congress and the President to provide temporary assistance to the states to help them stave off cuts to programs for children, the elderly and the disabled.

Many states are feeling pressure to cut Medicaid budgets this year to address serious deficits. The AARP Board of Directors, which is meeting with key lawmakers and issue experts here this week, is concerned about the potential harm these cuts will cause to some of America’s most vulnerable.

AARP President Jim Parkel explained, frail and disabled people will lose home and community-based health services. Nursing homes won’t be able to hire enough staff. Children and older Americans will lose coverage from state assistance programs. 

With no help from Congress, states may be forced to cut off coverage for many in need and not just the poor,  Parkel said.

Health providers, businesses, insurers and local governments will suffer as costs for services covered by Medicaid are shifted onto them,  he added.

The administration has proposed some short-term relief, however, AARP is concerned that the administration’s proposal for lump-sum allotments  to the states is insufficient and could lead to more Medicaid cuts. This proposal handcuffs states because it leaves people more vulnerable in future years as states struggle to meet increased needs with decreased dollars,  said AARP Executive Director and CEO Bill Novelli.

States need temporary assistance to help maintain health coverage in the current economic climate, not permanent changes that will reduce or eliminate future care. Congress should provide a temporary increase in the rate at which federal government matches state Medicaid spending. 

In Illinois, AARP is working to preserve the basic package of services in these tight budget times that are critical to the frail elderly. Such programs and services help the frail elderly remain independent and include: full funding of state financed prescription drug assistance; full funding of the State Health Assistance Program; enhanced funding for adult day services; protection of homemaker clients and emergency grants to senior centers at risk of closure or elimination of programs. In Illinois, our state leaders are faced with the daunting task of somehow closing a projected $5 billion gap. What we need is meaningful temporary relief in the states, in this budget year, that assists us in this crisis right now, said AARP Illinois State Director Ralph Yaniz.

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