Talking points and links to resources: 
WHY CUTTING MEDICAID FOR FAMILIES IS A BAD IDEA – December 2002 

Health coverage for low-income working families is under attack, as the Governor and legislature face an estimated $3-5 billion deficit in the biennium beginning July 1, 2003. Here are several reasons why cutting “Healthy Start Healthy Families” Medicaid for low-income children and their parents is a bad idea: 

1. Healthy Start Healthy Families Medicaid is cost-effective: The 1.25 million non-disabled children and adults comprise 71% of Medicaid users, but only 23% of program costs. And, Ohio’s per capita spending is way below the national average: 29th for adults, 45th for parents. From 2000-2005, the average annual growth for Ohio Medicaid will be less than for private insurance, according to Ohio’ Medicaid director. 

Most Medicaid spending is in the Aged, Blind and Disabled programs constitute 29% of users but incur 77% of costs. Major program changes are needed to stem the growth in costs, while meeting long-term care needs of our growing elderly population, such as increasing access to home-based alternatives to nursing homes. But most changes are unlikely to occur in time to affect this budget.

2. Medicaid boosts Ohio’s economy, by bringing substantial amounts of federal funding into the state. This funding creates jobs and increases spending, especially important during a recession. As Medicaid caseloads grow, so does federal funding. 

A study of the economic benefits of Medicaid in South Carolina, applicable to Ohio: http://research.moore.sc.edu/Research/studies/medicaideconimpact.pdf   

3. HSHF Medicaid benefits workers and their families. Health coverage allows low-income working parents to stay healthy, go to work, and treat chronic health conditions.

See, The Facts on MassHealth: What it is, Why it Works: http://www.communitycat.org 
Rhode Island's Rite Care, “Right for RI”: http://www.communitycat.org/acrobat/RIteCareFINAL5-1-02.pdf 

4. HSHF Medicaid helps the health care system for everyone. When hospitals and physicians treat uninsured patients without getting paid, they shift costs to others, resulting in higher health insurance premiums.

5. Charging co-pays to people on Medicaid is penny-wise but pound-foolish. Co-pays keep poor people from seeking care on time, causing them to incur far greater costs when problems worsen. A study shows that 26% of Medicaid beneficiaries could not get a prescription filled in the past year due to multiple cost-sharing. 
http://www.familiesusa.org/html/medicaid/medicaid.htm 

6. Cutting “optional” services doesn’t make sense. Dental and vision services are a small part of Medicaid costs, but are critical to enabling poor people go to work.

7. Medicaid caseload growth isn’t “out of control,” but represents a correction. The Medicaid caseload took a sharp dip from 1994-99, coinciding with welfare reform. As people left “welfare” (cash assistance) for work, many remained eligible for Medicaid, but left the program. During the dip, Ohio under-spent on Medicaid and turned surpluses into tax cuts, artificially eroding the tax base of the Medicaid program. The recent increases in caseload and spending reflect a “catching up” phase. 

8. Saving and Expanding Medicaid: We Need a Bigger Funding Base
The biggest problem in the Medicaid program, in Ohio and other states, is not inefficiencies or overspending, but rather an inadequate funding base. For more on state fiscal crises, see www.cbpp.org/state. 

a. Medicaid – and the whole budget – need more revenues. Saving Medicaid, and other needed social programs will require tax increases. Advocates are looking for tax proposals that will not hurt poor people. 

“Questions and Answers About Ohio’s Tax and Budget Crisis,” from the Health and Human Services Budget Coalition, explains the budget crisis, with footnoted, facts and figures. For instance, “Q. Can Ohio afford to raise taxes without hurting its competitive position?” A. “Yes. 33 states have higher per capita taxes than the State of Ohio. Thirty-eight states have higher per-capita corporate taxes than Ohio.” Read more, at the Federation for Community Planning website, www.fcp.org/haveaheart.htm. 

b. The federal government should help Ohio and other states during lean times. For example, Congress should enact a temporary increase in the federal match rate for Medicaid. An earlier Senate amendment would have provided Ohio with $200 million over 18 months.