Gibbons orders study of possible Medicaid pullout

CARSON CITY — Gov. Jim Gibbons has asked staff members to explore whether the state can drop out of the Medicaid program that provides free health care to more than 233,000 Nevadans.

A Gibbons spokesman said today that because of the bad economy, the state can no longer cover most Medicaid recipients, even though the federal government provides most of the funding. He said things will only get worse if Congress approves the health care bill.

Under the health care legislation being considered by a Senate-House conference committee, Nevada would pay an additional $613 million between 2014 and 2019, to provide health care through Medicaid for another 328,000 residents. It would pay no additional Medicaid costs in the three years before 2014.

Daniel Burns, the governor’s communications director, said if the idea of dropping Medicaid proves feasible, the state would use its own money to continue to provide care for those who might otherwise be left behind, including the seriously ill and disabled.

A conservative Las Vegas-based think tank the idea could save the state money and suggested that the state’s poor probably would be better off without Medicaid.

But legislative leaders said Gibbons’ idea would not receive their approval, which might be required. And a nonpartisan policy research group that watchdogs Congress said dumping Medicaid would leave many Nevadans without health care.

Assembly Speaker Barbara Buckley, D-Las Vegas, questioned whether the governor’s talk about ending Medicaid was serious or an attempt to improve his re-election chances.

“It appears they are veering from sound bite to sound bite,” she said. “It just seems to me this is all about bolstering his poll numbers and not about serious government at a critical time in our state.”

She said Medicaid provides health care for seniors in nursing homes, foster children and others who are seriously ill. In coming weeks, legislators will begin discussing the state’s budget shortfall and steps that can be made to reduce it, Buckley said. She said Gibbons has not yet responded to her request that he join them in an attempt to reach mutual agreements.

Senate Minority Leader Bill Raggio, R-Reno, doubts pulling Nevada out of Medicaid is “workable.” Raggio said he has been told that Gibbons is only doing an analysis to determine what cost savings would result if the state rejected federal Medicaid dollars.

If Nevada stopped taking the money, then Raggio said only about one-third of the current Medicaid recipients would continue to receive care.

A spokesman for U.S. Senate Majority Leader Harry Reid of Nevada, who guided the health care bill through the Senate,

said Gibbons does not understand the ramifications of pulling out of Medicaid.

“By dropping out of Medicaid, he would only increase the number of uninsured in Nevada, which increases the number of people going to the emergency room for treatment, which is then paid for by taxpayers,” Reid spokesman Jon Summers said.

As it is now, $2.9 billion will be spent in Nevada in the two-year budget period that ends June 30, 2011, to pay for Medicaid. Of that total, $868 million come from the state.

As the state has dropped deep into recession, the number of people receiving Medicaid has reached record totals, climbing 40,000 in the last year.

Geoffrey Lawrence, a fiscal policy analyst for the Nevada Policy Research Institute, the conservative think tank, said opting out of Medicaid would not result in thousands of Nevadans going without health care, or leaving unpaid bills at emergency rooms.

Under provisions of the Senate-approved bill, residents without health care could receive federal subsidies to allow them to purchase private health care policies, he said.

For the most poor, a 100 percent subsidy would be given. Others would pay up to 9.8 percent of their income. “They probably would receive better health care than under Medicaid,” Lawrence said.

He said some doctors refuse to treat Medicaid patients because payments for treatment are too low.

But Judith Solomon of the Center on Budget and Policy Priorities in Washington, D.C., said the subsidies still would be too expensive for most poor people to pay. Dropping Medicaid would lead to even more people going without health insurance, she predicted.

“It would lead to a lot more children going without health care,” she said.

Nevada Checkup, a health care program for poor children, is dependent on the state’s participation in Medicaid, according to Solomon.

Hospitals that now receive additional funds for treating large numbers of poor people would not receive those funds if the state dumped Medicaid, she said.

Based on preliminary search, Charles Duarte, administrator of the state Division of Health Care Financing and Policy, said it appears states can opt out of Medicaid, although he emphasized he has not yet talked with staff lawyers.

Duarte, whose division runs the state’s Medicaid program, said the U.S. Supreme Court, in a Virginia case, seemed to indicate states can pull out.

He said if Nevada dropped Medicaid, it still would offer free care to foster children, the disabled and seniors in nursing homes.

Burns said Gibbons is talking with lawyers to determine whether he can pull Nevada out of Medicaid on his own, or would need approval of legislators during a special session.

Contact Capital Bureau Chief Ed Vogel at evogel@reviewjournal.com or 775-687-3901.