Stateline Story

State Health Experts Cite Budget Woes As Major Concern

Prescription drugs, tobacco prevention, rising health care costs and Medicaid are high priority areas for health officials across the country. But revenue shortfalls remain the over-arching concern, policymakers from five states said Sunday (11/18) at a forum in Seattle, Washington. The forum, sponsored by the National Conference of State Legislatures, featured health-related officials from Arizona, Connecticut, Maryland, Oregon and Washington State.

"One of the most obvious issues" affecting our state is the budget, said Mary Selecky, Secretary of Washington's Department of Health. The Evergreen State is one of a handful of states that does not have a personal income tax and voters recently okayed an initiative to limit property tax growth. "Local budgets will get hit hard" following the vote, Selecky predicted.

Gov. Gary Locke (D) has asked state agencies that use general fund monies to create a list of programs to be cut. Selecky said her list includes "favorite programs of legislators," like child-death reviews and certification of businesses as breast-feeding friendly. "We have tough budget decisions to make, but we have to make them smart," she said.

Connecticut Medicaid director David Parrella said he plans to focus on his state's "drug problem," namely the high cost of prescription drugs. "It doesn't mean prescription drugs are a bad thing... (but) a lot of expenditures are on 'me too' drugs, or new (and more expensive) drugs that come on the market right when another is coming off patent," he said.

In addition, pharmaceutical companies have stepped up direct marketing efforts, which "has totally changed the dynamic of health care forever," Parrella noted. Everyone wants to take a certain drug because they see a commercial on TV and it may not be the most cost-effective approach, he said.

Connecticut's budget picture looked pretty rosy before Sept. 11, with a $600 million surplus. Since that date, the state has reported a $301.7 million budget deficit.

Despite the huge financial plunge, the Medicaid program will dramatically increase spending for home health care, which is an alternative to high-cost nursing home care. "We're not doing it in any altruistic way. This type of program requires an investment upfront to achieve savings," he said.

Parrella also said his agency would work to develop partnerships with private companies to help foot the bill for health insurance coverage for the needy, a concept known as cost sharing.

Four officials acknowledged that despite the softening economy, it would be tough to cut programs that people have started to rely on or to cut off recently uninsured people. "People who are losing their jobs are from higher incomes, so the face of the uninsured will be different (than what it has been)," said Maryland Secretary of Health Georges Benjamin. "This new group of uninsured people will be very vocal (about their needs) and they vote," Benjamin said.

Arizona Senate Health Committee chairman Susan Gerard said lawmakers plan to cut several expansions they had just okayed in last year's session. "People are going to be without health services, but ... (new programs) will take a back burner because of the economy," she noted.

Gerard said the state does not plan to cut the recently approved breast and cervical cancer treatment program for women. "We have a 75 to 25 federal-state split (on money) and we can't cut that," she says.

Maryland's Benjamin, like other panelists, said states should take a hard look at health care spending before applying cuts. "Should we be rationing health care or investing in it and riding that horse for all it's worth? There is a return on the money when you invest it wisely," he said.

Tags: Health