Medicaid cutbacks could result in rationing of medical care, officials say

By Cy Ryan

Wednesday, Feb. 23, 2011 | 1:46 p.m.

CARSON CITY – Cutbacks in Nevada’s Medicaid program could lead to a rationing of medical services and financial difficulties for hospitals, witnesses told a legislative budget subcommittee on Wednesday.

Kathy Silver, chief executive of University Medical Center, said a 5 percent proposed reduction in payments for Medicaid payments would result in a $6.3 million cut to the public hospital in Las Vegas.

Silver said other hospitals in Southern Nevada might transfer their Medicaid patients to UMC because the doctors in those hospitals could refuse treatment due to lower reimbursement rates.

The Legislature reduced the Medicaid rates for hospitals in 2008 and UMC lost $30 million as a result.

Chuck Duarte, administrator of the state’s Medicaid program, which provides care for the indigent, outlined the cuts recommended by Gov. Brian Sandoval to the program with 280,000 patients. It is projected to grow to 312,000 patients by the end of 2013.

Bill Welch, representing the Nevada Hospital Association, said 10 of the 13 hospitals in Clark County are operating at a loss. “We can’t continue this,” he said, and predicted a “significant change in services.”

Larry Matheis, representing the Nevada State Medical Association, said he has “grave concern” over the proposed reduction in rates for doctors treating Medicaid patients.

He said physicians providing specialty care are not being paid for their costs in treating patients. He predicted this would lead to rationing of medical services due to insufficient payments.

The governor’s Medicaid budget calls for transferring costs to counties. Bobby Gordon and Susan Rhodes of Clark County said the county would have to absorb $17 million more to care for nursing home programs, with possibly $6.5 million on top of that for expanded services.

Gordon said this would result in a “serious impact” to the county.

Duarte said the proposed budget calls for a rate reduction of $20 per day per patient at nursing homes. The payment to nursing homes now is $189 per day per patient. He said Nevada was in the middle of western states on its the rates paid for Medicaid payments.

Duarte said 60 percent of patients in nursing homes are on Medicaid and private rates paid are higher than rates paid by the state.

There would also be a cutback in clinical services for mentally challenged children on Medicaid. Duarte said a child has to show improvements or Medicaid would no longer make payments.

There is a proposed 15 percent reduction to those who provide home and community-based services to the elderly, for a savings of $1.3 million. That includes adult day care.

The state would also eliminate paying for glasses for adults in the Medicaid program, but eye examinations would still be covered. That is expected to affect 7,833 adults, Duarte said. The state will still cover the cost of glasses for children.

He also outlined steps being taken to comply with the new federal health care law and said Medicaid “will have to create a new benefit package akin to private insurance.”