Virginia Counting on Medicaid Funding (VA)
June 14, 2010
The U.S. Senate is expected to vote soon on federal Medicaid funding that will impact health services in Virginia.
The two-year budget approved earlier this year by state lawmakers depends on that federal Medicaid funding–about $430 million for Virginia–to mitigate cuts to Medicaid services. If Congress doesn’t approve the funding, many health services for elderly and disabled people will see steeper cuts than health organizations had hoped for.
In writing the budget this year, state lawmakers had to make about $4 billion in reductions to spending, and early versions of the budget made deep cuts to many Medicaid services including physician reimbursements, waiver services for the disabled, respite services, long-term care and ot her services.
To try to ease the pain of such cuts, budget writers decided to go ahead and write into the budget the federal money (called Federal Medicaid Percentage Assistance, or "FMAP" money in legislative parlance) even though it hadn’t yet been approved by Congress.
The total for the FMAP funding is $24 billion.
If it isn’t passed, states’ actions to compensate for the loss and balance their budgets could cost 900,000 jobs across at least 34 states, according to a report from the Center on Budget and Policy Priorities.
They expected Congress to approve the money, but the cost of extending FMAP funding earned it opponents, and the House of Representatives did not approve it.
Now it’s the Senate’s turn to vote on a bill that includes the FMAP funding, along with extensions of benefits for unemployed people and other issues. The Senate is expected to vote on it this week, and advocacy groups for the disabled and others who would be hurt if the money isn’t approved have been lobbying senators for support.
The ARC of Virginia, which lobbied heavily against cuts to services, has urged its members to call both of Virginia’s senators and urge them to vote for the FMAP extension.
Sen. Mark Warner’s office has been getting calls, said spokesman Kevin Hall.
"He’s fully aware of the potential impact back home if this doesn’t pass," Hall said.
The FMAP extension covers two quarters, but Virginia’s budget spreads it out over both 2011 and 2012. That means that if Congress doesn’t approve the FMAP money by July 1, when the 2011 fiscal year begins, the cuts would kick in.
The state Department of Medical Assistance Services, which administers Medicaid and would bear the brunt of the $430 million in reductions, has already begun notifying providers of the potential decrease in reimbursement rates that would happen if the FMAP money isn’t approved.
"The longer it goes without them voting on it, the more nervous I get. It’s just so critical to our health care funding in the state," said state Sen. Edd Houck, D-Spotsylvania, a budget negotiator who was heavily involved in legislators’ efforts to ease cuts to health services. "It’s been a real roller coaster."
Last week, two state senators held a conference call with reporters to talk about the need for the funding.
"Those budget cuts in the budget that we passed were contingent on receiving the FMAP money," said Sen. Ralph Northam, D-Norfolk, a physician who said about 45 percent to 48 percent of his patients receive Medicaid. "It was pretty certain that that money would be coming down. To not have that is going to be significant for the commonwealth."
He and Sen. Mark Herring, D-Loudoun, said they hope Congress will approve the FMAP extension.
"The point is, this will really affect those who are most vulnerable in our community who have already experienced cuts in services, and this would even impact them more, and I hope Congress will recognize the urgency of taking action," Herring said.