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JOUJUfAL.
OPINION
Prescription for Medicaid
I
n the year just ended, Maine
spent $969,600,000 on a single
program - not quite as much
as we spend on our public schools
(kindergarten through 12), but
more than seven times as much as
we spend on the University of
Maine System. The program is
Medicaid.
Medicaid is a federal -state part-
nership in Maine that goes back
over 30 years. About 75 percent of
the dollars flow to support health
care needs of the elderly and dis-
abled, but there are no age require-
ments for low income people and,
in Maine, it tonches the lives of
thousands of children. While most
public attention is focused on
Medicare, it is the Medicaid that is
tearing huge chunks out of the
state budget.
Because state appropriations are
malched about 2 to 1 by federal dol-
lars, a cut in state dollars has a dis-
proportionate effect on services by
the state. Nonetheless, si nce the
last years of the McKernan admin-
istration's budget crunch, the state
has made an aggressive effort to
make cost savings by changing eli -
gibility and by funny money financ-
ing.
Maybe I am a Grinch to hold
Medicaid up to public scrutiny at
this season. From a compassionate
point of view, it touches the lives of
some of our most vulnerable peo-
ple in a host of ways that should
give us a sense of satisfaction that
we are indeed our brothers' keep-
ers.
But from a fiscal point of view, it
is eating us alive, and we do not
seem to have the will or answers to
get it under control. There are
about 9.000 nursing home beds in
Maine and only about one-third of
Viewpoint
Bennett
Katz
KJ EkJara
of
the patients are private payers.
The rest, overwhelmingly, are
Medicaid.
Private insurance for long-tenn
care is so expensive that rew peo-
ple bave it. Greg Gravel, who runs
Kennebec Long Term Care' s two
nursing homes in Augusta, tells me
that a semi-private room costs
about $45,000 a year.
Why are there so rew older nurs-
ing home residents who can afford
to payout of their savings or out of
the equity in the homes to which
they will never return?
The answer is partly transfer-
ence of assets. What aged momma
does not want to leave the kids a
nest egg? So she gilts or somehow
conveys title to her assets to her
children, leaving herself purposely
destitute and able to qualify (or
Medicaid. As long as assets are
conveyed at least 30 months prior
to inslilutionaJization, it is appar-
ently legal.
That's the way the ball game is
played and it is so prevalent that
there appears to be no social stig-
ma attached.
Do you see the pictures of Amer-
icans celebrating birthdays of 100
years or more on the 1oda." pro-
gram on NBC? We have many of
these truly remarkable people in
Maine and the percentage of 85
and older population is higher than
the national average.
As Congress has tightened the
screws with difficult r egulations
and as our population continues to
age, we appear to be running fa ster
to stay in the same place.
I had a long talk with Francis
Finnegan, who runs the program
for Maine. I have known Fran since
he was a little kid in Augusta and I
have great comfort that we are in
such capable hands. He tells me
that we have one or tbe most gen-
erous programs in the nation,
despite our low per-capita income.
Controlling future costs is not
going to be easy for two reasons.
First, because we have no quick-
flX, easy answers and, second,
because people are going to be
hurt, both providers of services and
those whom we serve. This spells
political trouble and requires sub-
stantial political courage.
I wrote this article knowing that
Medicaid is as enormously compli-
cated as it is expensive. I think that
it is essential that we talk about it
more and try to understand it bet-
ter. A two-minute segment on the 6
o'clock news isn't going to help
much. Advocates of unlimited enti-
tlements or balchet-wielding legis-
latures aren't the answer. Medic-
aid touches the lives of so many
Maine people, does so much good
and costs so outrageously much
money that discussion should be at
the people level.
I'm going to invite Finnegan to
speak to tbe Augusta Kiwanis .Club
as a starter. Then, I'm going to
challenge the KJ to do a major fea-
ture series on it. If my column
doesn' t appear anymore, you'll
know that I got fired for being too
pushy.
£BEC JOUBNAL.
,
OPINION
Prescription for Medicaid
I
· n the year just ended, Maine
. spent $969,60j),00j) on a single
. program - not quite as much
as we spend on our public schools
(kindergarten through 12), but
more than seven times as much as
we spend on the University of
Maine System. The program is
Medicaid.
Medicaid is a federal·state part·
nership in Maine that goes back
"over 30 years. About 75 percent of
the dollars flow to support health
care needs of the elderly and dis-
" .. able<!, but there are no age require-
.: menis for low income people and,
. in Maine, it touches the lives of
thousands of children. While most
'public attention is focused on
. Medicare, it is the Medicaid that is
..0' tearing huge chunks out of the
:: state budget.
. Because state appropriations are
matched about 2 to 1 by federal dol-
lars, a cut in state dollars has a dis-
': j>roportioDate effect on services by
the state. Nonetheless, since the
.",last years of the McKernan admin-
·.\stration's budget crunch, the state
.: has made an aggressive effort to
;jlnake cost savings by changing eli-
(-gibility and by funny money financ-
·rMaYbe I am a Grinch to hold
::kedicaid up to publi c scrutiny at
/Jhis season. From a compassionate
: jioint of view, it touches the lives of
.. me of our most vulnerable peo-
; Ie in a host of ways that should
. e us a sense of satisfaction that
we are indeed our brothers' keep-

;, But from a fiscal point of view, it
is eating us alive, and we do not
seem to have the will or answers to
get it under control. There are
ahaut 9,000 nursing borne beds in
Maine and only about one-third of
Viewpoint
Bennett
Katz
)(J Board
of
the patients are private payers.
The rest, overwhelmingly, are
Medicaid.
Private insurance for
care is so expensive that few peo-
ple have it. Greg Gravel, who runs
Kennebec Long Term Care's two
nursing homes in Augusta, tells me
that a semi-private room costs
about $45,00j) a year.
Why are there so few older nurs-
ing home residents who can afford
to payout of their savings or out of
the equity in the homes to which
they will never retum?
The answer is partly transfer-
ence of assets. What aged momma
does not want to leave the kids a
nest egg? So she gifts or somehow
conveys title to her assets to her
children, leaving herself purposely
destitute and able to qualify for
Medicaid. As long as assets are
conveyed at least 30 months prior
to institutionalization, it is appar-
enUylegal
That's the way the ball game is
played and it is so prevalent that
there appears to be no social stig-
ma attached.
Do you see the pictures of Amer-
ieans celebrating birthdays of 100
years ,or more on the Today pro-
gram on NBC' We have many of
these truly remarkable people in
Maine and the percentage of 85
and older population is higher than
the national average.
As Congress has tightened the
screws with difficult regulations
and as our population continues to
age, we appear to be running faster
to stay in the same place.
I had a long talk with Francis
Finnegan, wbo runs the program
for Maine. I have known Fran since
he was a little kid in Augusta and I
have great comfort that we are in
such capable hands. He tells me
that we bave ODe of the most gen-
erous programs in the nati on,
despite our low per-capita income.
Controlling future costs is not
going to be easy for two reasons.
First, because we have no quick-
flx, easy answers and, second,
because people are going to be
hurt, both providers of services and
tbose whom we serve. This speUs
political trouble and requires sub-
stantial political courage.
I wrote this article knowing that
Medicaid is as enormously compli-
cated as it is expensive. I think that
it is essential that we talk about it
more and try to understand it bet-
ter. A two-minute segment on the 6
o'clock news isn' t going to help
much. Advocates of unlimited enti·
tlements or hatchet-wielding legis-
latures aren't the answer. Medic-
aid toucbes the lives of so many
Maine people, does so much good
and costs so outrageously much
money that discussion should be at
the people level.
I'm going to invite Finnegan to
speak to the Augusta IGwanis.Club
as a starter. Then, I'm going to
challenge the KJ to do a major fea-
ture series on it. If my column
doesn' t appear anymore, you'll
know that I got fired for being too
pushy.
' .
..

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