From Wall Street Journal (5.20.10):
Disabled Face Hard Choices as States Slash Medicaid
By CLARE ANSBERRY
FLORENCE, S.C—Tandem forces of shrinking state budgets and rising health-care costs have collided and struck a small brick ranch house in this rural town, home to Barbara Hickey.
Born with cerebral palsy, Ms. Hickey, now 67 years old, is confined to a motorized wheelchair. She lives alone and relies on certified nurse's assistants to get her in and out of bed, bathed, clothed and fed.
In December, she received a letter from the South Carolina Department of Special Needs and Disabilities, saying her weekly 50 hours of personal-care help was being cut to 28 hours. That meant Ms. Hickey would get help for two hours in the morning and two hours at night. If she needed to use the bathroom in between, she would sit in a soiled diaper.
...Home health care—funded largely by Medicaid—generally costs less money than institutionalizing developmentally disabled people like Ms. Hickey. But the political reality is that it's easier to cut back home services than to close a 24-hour facility, which can leave people with nowhere to go. Thus, some of the biggest cuts around the country are happening in the basic services that help the disabled cope at home.
South Carolina says it has little choice but to cut funding for Medicaid. It faced a $563 million deficit for the current fiscal year, and like other states must have a balanced budget. Medicaid, the joint federal-state health-insurance program for the poor and disabled, already consumes about 20% of its $5 billion budget and is one of its fastest growing costs.
...Across the country, budget-strapped states are focusing on Medicaid. Created in 1965, it is now a $379 billion program, including state and federal funds. State spending grew an average 7.9% in fiscal 2009 as the economic crisis hit and more people signed up for Medicaid.
...But states don't have much flexibility when it comes to what they can and can't cut inside Medicaid. Although it is a state-managed system, the federal government pays a percentage of each state's total costs and makes many of the Medicaid rules. Under federal Medicaid law, states must offer inpatient and outpatient hospital care, X-rays and lab services. They also have to cover nursing-home services and meet certain standards, such as staffing ratios.
...Recent state cuts have targeted developmentally disabled people living at home. In December, families were told that some of their in-home support was being cut by as much as half...