State legislatures tackle budget cuts, tort reform; Medicaid, SCHIP.(Practice Trends)

WASHINGTON -- Budget cuts and tort reform are the hot health care items on legislators' plates so far this year, just as they were last year, Susan Laudicina said at a press briefing sponsored by the Blue Cross and Blue Shield Association.

"If I had to characterize the political atmosphere [in the states], I would say it's deja vu," said Ms. Laudicina, who is the association's director of states services research. "Nearly every state is struggling to cut costs in Medicaid and the [State] Children's Health Insurance Program [SCHIP]."

So far, 20 states have been forced to make cuts in Medicaid and SCHIP this year, she said. These cuts have taken various forms: Arizona and Connecticut suspended coverage of SCHIP enrollees' parents, while Oklahoma and Texas got rid of their programs for the "medically needy." And 13 states have reduced reimbursement rates for providers in the Medicaid program.

"This is the worst fiscal climate states have had since World War II," Ms. Laudicina said. "The cuts would have been a lot higher if not for $20 billion in emergency federal funds" for budget relief.

But a few states are swimming against the tide and expanding coverage for certain groups, Ms. Laudicina noted. Idaho, for example, debuted a pilot program for small businesses in which the state provides a $100 monthly subsidy per employee to help them purchase private insurance or buy SCHIP coverage for adults and children. And Maine enacted a set of comprehensive reforms designed to insure all residents over the next 4 years.

High-risk pools also were a focus in some states. South Dakota became the 31st state to create such a pool, and 8 states expanded eligibility for ...