If a 35 percent reduction in reimbursements to Medicaid announced last week by Gov. Steve Beshear goes into effect April 1 as planned, approximately 90 of Kentucky's 132 hospitals — those not designated as critical access hospitals — will lose about $125 million in reimbursements over the last three months of the fiscal year ending June 30, officials with the Kentucky Hospital Association told a House committee Tuesday.
Other representatives of health care providers told the Appropriations and Revenue Committee the state's doctors would lose about $44 million during the same period and reimbursements for 30-day supplies of frequently prescribed medications would be less than they cost Kentucky's 400 to 500 independent pharmacies. One example mentioned to the committee involved Lipitor. A pharmacy could lose $64 on a 30-day prescription of the popular cholesterol drug. Other losses could run even higher
If the cuts come about, the committee was told, some doctors probably will stop accepting Medicaid patients; independent pharmacies with high numbers of Medicaid customers may be forced to close because they don't have the resources to sustain losses on prescriptions for even short periods of time; and hospitals, which can't opt out of Medicaid, might offset some of their losses on the program by charging private health insurers more, in turn leading to higher health insurance premiums.
Later Tuesday, the House Judiciary Committee heard descriptions of a few of the effects of imposing the across-the-board spending cuts Senate Republicans are demanding in exchange for agreeing to fix the Medicaid budget by transferring $166.5 million from next year's budget to this year's spending plan.
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J. Michael Brown, secretary of the Justice and Public Safety Cabinet, said applying the cuts to the provisions of House Bill 463, passed in this year's regular General Assembly session, would represent "one step forward and two steps backward" in the effort to implement reforms of the penal code and controlled substance laws. For instance, the drug treatment programs and the educational and vocational programs at the heart of efforts to prepare non-violent offenders for re-entry to society would suffer cuts running into the millions of dollars.
The effects of the Senate proposal would be experienced throughout the cabinet's various agencies, and beyond, the committee heard. Layoffs could be in the future for commonwealth attorneys, county attorneys and the Department of Public Advocacy.
Of course, the Senate's proposed spending reductions would not be limited to the area of crime and punishment in Kentucky. Equally painful cuts would affect education, social services, environmental protection, indeed, every aspect of state government.
And none of them necessary.
Contrary to Senate President David Williams' continuing efforts to deceive Kentuckians, all the available evidence strongly supports Beshear's proposal to offset the money shifted from next year's budget to this year's with savings from implementing a managed care approach to Medicaid at the start of the next fiscal year.
All the proof Williams has to the contrary are the misleading words coming from his own mouth and the mouths of his Republican parrots in the Senate.
Williams and those parrots are totally responsible for the breakdown of House-Senate talks in the regular session that ended last week. They are totally responsible for the wasteful cost of the ongoing special session. And they will be totally responsible if Medicaid recipients and providers suffer the painful consequences of huge reimbursement reductions from April 1 through June 30.