Revenue Cycle

Budget bill: States given new rights to regulate Medicaid

Patient Financial Services Weekly Advisor, December 23, 2005

A final Congressional agreement on a budget bill will give states the right to impose premiums and copayments on Medicaid recipients, freeze physicians' pay under Medicare, and beef up work requirements for welfare recipients, reports the New York Times.

The agreement, approved last week by the House of Representatives and the Senate, is the brainchild of both the Republicans and Democrats, who together are trying to curb the soaring cost of Medicaid.

The agreement says states can issue higher premiums for a wide range of Medicaid benefits, including prescription drugs, physicians' visits, and hospital care. States can also end Medicaid coverage for those who fail to pay their premiums for 60 days or more. Additionally, physicians can deny services and pharmacists can refuse to fill prescriptions for those who do make their copayments.

The budget bill would save the government $26.5 billion in Medicaid and $22.3 billion in Medicare over the next 10 years, according to the Congressional Budget Office.

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