Bill would delay cutbacks in federal Medicaid funding

WASHINGTON -- Nevada will be spared at least $11.8 million in federal cutbacks for Medicaid this year under a bill Congress is expected to complete this week, officials said Monday.

Lawmakers are delaying until next year a half dozen changes the Bush administration had proposed to limit costs and tighten eligibility in the health program for low-income families and disabled people.

Medicaid is funded by individual states and the federal government.

The House approved the moratorium last week as part of a larger bill that continues funding for the wars in Iraq and Afghanistan, expands education benefits for returning veterans and offers people without jobs an additional 13 weeks of unemployment payments.

Sen. Harry Reid, D-Nev., said the Senate will take up the bill this week.

Shelving the Medicaid rules "means tens of millions of extra dollars to our state and more important, it means preservation of key services to our elderly and people with disabilities," Reid said in a call with reporters on Monday.

The Senate majority leader said the congressional action amounted to a "repeal" of the rules because a new president could decide not to revive the cutbacks.

Charles Duarte, administrator of the Nevada division of health care financing, estimated earlier this year in a letter to Congress that the changes would translate to a loss of at least $11.8 million in 2008 funding to Nevada.

Over five years, the cost to Nevada could be at least $62.4 million. Some of the further effects could not yet be specified, Duarte said.

Under a compromise with the Bush administration, a seventh proposed Medicaid regulation will be allowed to go into effect.

The regulation limiting payments for certain hospital outpatient activities is not expected to affect Nevada because the state does not offer services that would be covered, said Ryan McGinness, director of the state's Washington office.

Nevada's projected $250 million budget shortfall did not account for possible cuts in Medicaid, Assemblywoman Sheila Leslie said.

"It clearly would have made a bad situation worse," Leslie said.

The cutbacks would have forced states to find other revenue to restore the federal funding, raise taxes or cut back on their Medicaid programs by reducing eligibility or health benefits or cutting back payments to doctors, according to the Center on Budget and Policy Priorities, a nonpartisan think tank.