Budget Shortfalls Produce Health Care Cuts In Many States

Today, I would like to direct your attention to the Kaiser Network's Daily Health Policy Report of March 31, 2008. Their continuing roundups of pertinent health care news are always useful and informative.*

The reason I would like to focus on this particular new roundup is the overall topic: state level budget shortfalls endangering health care funding. The weakness of the current American economy combined with more than half of U.S. states facing shortfalls in their budgets the outcome for medically oriented spending seems bleak.

The budgetary gaps run the gamut, but generally all fall into the range of billions of dollars. On the lower end we have states like Florida whose shortfall is only about 43 billion, with California taking the lead with a deficit of $16 billion. No matter which side of the spectrum you look at the solution continues to be spending cuts. Medical care is often the first to feel the ax when budgets run low due to the perception of "immediate savings" and the skyrocketing escalation of costs.

California Gov. Arnold Schwarzenegger (R) has already proposed $650 million in cuts to Healthy Families (California's SCHIP program). Those cuts have the potential to affect as many as 7 million people amongst the seniors and disabled of the state's population.

Even in Florida, the ax bites deep as this incomplete list of cuts shows us:

The House proposal would eliminate hospice coverage for 8,000 terminally ill beneficiaries, coverage of hospitalization costs for 20,000 transplant recipients, and diagnosis and care for 2,300 children with cleft lips or cleft palates. The House measure also would eliminate coverage of dental and vision care, as well as hearing aids, for 146,000 seniors to save $32 million. In addition, the budget proposal would reduce funding for the Medically Needy program by $170 million.

A faltering economy and continually rising costs of care have created a climate where this type of news will probably be a daily occurrence. As a nation, we need to implement systems thinking, even out the distribution of health care costs, implement electronic medical records, and basically do whatever it takes to reform our health care "non-system."

*Disclosure: The Health Care Reform Now! Blog does have a relationship with Kaiser due to it being a companion blog to Kaiser CEO George C. Halvorson's latest book, Health Care Reform Now!.

EDIT 4/24/08: The Kaiser Daily Reports are a product (free service) of the Kaiser Family Foundation, which is actually not at associated with Kaiser Permanent, Kaiser Foundation Health Plan or Kaiser Foundation Hospitals. The disclosure above was purely my own error and I greatly appreciate Robin at the KFF setting me straight on the matter! For more info about the Kaiser Family Foundation follow this link.

SOURCE: "Coverage & Access | Cuts to Health Care, Other Programs by States Trying To Address Budget Shortfalls Might Disproportionately Hurt Low-Income Populations" 03/31/08
photo courtesy of Jeff Keen, used under this Creative Commons license