Miami Herald - March 1, 2005
Marc Caputo, mcaputo@herald.com

A nurse, beating cupped hands on Jamal's back to knock loose the fluid in his chest and nose, turns off a gospel TV show and pops in a videotape of Barney the dinosaur -- a favorite of the 9-year-old boy, whose perturbed moans give way to giggles and a broad smile.

Since birth, Jamal has survived thanks to Medicaid, a statefederal insurance program for the poor, elderly and disabled that pays almost all his costly medical bills. Though his is an extreme case, Jamal is just one of 2.3 million recipients in Florida, where one in eight people receive its benefits. Medicaid helps 27 percent of all Florida children and 44 percent of pregnant women, and pays about 66 percent of nursing home care.

OVERHAUL PROPOSED

Expected to cost more than $15 billion in Florida next year, Medicaid has grown annually by double digits, placing it in the sights of Gov. Jeb Bush. In what could become a national model to control Medicaid costs, Bush wants it to resemble private managed-care plans: Private companies, rather than the government, would largely decide the duration and scope of Medicaid benefits.

Talk of reform worries nearly everyone dependent on Medicaid, from nursing homes to hospitals to Jamal's adoptive mother, Carol Leaks, of Lauderdale Lakes. A mother of three girls, she adopted Jamal six years ago when no one else would take him from an orphan center where she worked.

"He just smiled that big smile and I knew he deserved a life with someone who loved him. He was the one for me," Leaks said.

Without Medicaid, she couldn't have afforded to adopt Jamal, a crack baby who was born with HIV. One of his AIDS drugs alone costs about $1,000 a month. Leaks said the program has helped the developmentally disabled boy, who often tries to stand and seems to hum along with songs from Barney.

'When guys like Bush say 'reform,' they mean cut the program," Leaks said recently. "These are people's lives we're talking about. I hope he remembers that. People need their Medicaid. Jamal needs this."

'THE ROOT CANAL'

The governor, who can point to a history of increasing state spending for the developmentally disabled, says he intends to provide better healthcare to more people at a cheaper and more predictable price.

Bush said concerns such as Leaks', echoed by scores of Medicaid recipients, are the result of Medicaid providers "telling them to be scared." He said the providers are "happy" to keep "the spigot" of cash flowing from the government. He notes that Medicaid consumes a quarter of the state's budget.

In discussing "the root canal we call Medicaid," Bush told the Greater Miami Area Chamber of Commerce on Monday that, without reform, "the Medicaid budget will suck the life out of our education programs, our environmental programs, other social service programs that have seen tremendous increases in spending, our child welfare system, programs for the disabled."

The governor hasn't mentioned that Medicaid previously experienced even greater growth rates, such as in 1993 when it rose 28 percent. The governor recently said the program would cost 18 percent more next year than this fiscal year, which ends June 30. But economists from several state agencies have predicted a more modest growth of less then 10 percent, taking into account proposed benefit cuts and reimbursement rate-freezes for hospitals, nursing homes and doctors.

Lawmakers have pledged to restore some of the cuts, including the Medically Needy program that serves the seriously ill, during the 60-day lawmaking session that begins March 8.

A panel of lawmakers assigned to flesh out Bush's proposal is touring the state and taking eye-opening public testimony from people like Leaks. From there, the state plans to ask the federal government -- which pays for 59 percent of the program in Florida -- to waive requirements that the state cover a broad array of costly Medicaid services. Among them, the number of guaranteed days that a recipient can stay in the hospital.

The reform process will likely take years. Meantime, the governor's brother, President Bush, has recommended trimming up to $60 billion nationwide from Medicaid during the next decade.

The governor's office has yet to explain how the private market can rein in costs when private insurance rates have risen at a faster rate than comparable Medicaid services. Bush's office has described the need for reform in terms of fairness, saying taxpayers shouldn't pay for a Medicaid program richer than their own health plan.

Medicaid "consumers," as Bush calls them, currently have two choices: receiving care from a physician or hospital that bills Medicaid directly for each service -- what's called "fee-forservice" -- or using an HMO that gets paid a contracted amount by the state for each Medicaid patient.

Jamal receives fee-forservice because Leaks doesn't like HMOs.

RIPE FOR FRAUD?

Bush wants to transition away from fee-for-service, where many experts suspect fraud is rampant. He says private firms would provide better financial oversight. The Legislature's watchdog agency, however, recently told lawmakers that Bush's managed-care proposal could lead to new types of fraud that would be tough to police.

Bush's Medicaid reform also doesn't address long-term care facilities, such as nursing homes, that consume 26 percent of the program's budget. Lawmakers recently delayed implementing that portion of the plan to allow for more public input.

Bush envisions replacing the existing system with a "cafeteria-style" array of health plans that don't exist right now. Currently, for example, HMOs that accept Medicaid patients must offer all services covered by Medicaid. Under the proposal, smaller insurance companies, health plans and physician networks could offer limited services tailored to treat specific populations, such as AIDS patients, minorities or the developmentally disabled.

To pay for the plans, recipients would use a state-funded voucher that estimates the price tag of their yearly medical costs. The value of a voucher -- called a "risk-adjusted premium" because it accounts for each person's financial risk -- would be determined by consultants and a new database system, which could cost tens of millions of dollars. Money from the voucher would be divided in four general ways: Medicaid services; the private health plans' administrative fees; a savings account that recipients could tap for medical-related expenses when they make good health choices, such as quitting smoking, and a catastrophic fund for the very ill.

By setting up the catastrophic fund, the state could either attract companies to offer a plan for this impossible-to-insure population, or provide a financial cushion for health plans whose recipients get very sick unexpectedly and require more money than is provided by the voucher.

Recipients, who might have to start using some of their own money for a copayment, could also opt out of the whole system by using the state-paid voucher to enroll in a private health plan.

Michael Cannon, a health policy expert with the libertarian Cato Institute in Washington D.C., said the governor's "risk-adjusted" proposal is one of the most innovative in the country.

"You want the beneficiary to feel like a part of the decision-making process," Cannon said. "To make the person a prudent shopper, you have to give them an ownership interest. You have to enable them to find health care and make informed decisions."

It's easier said than done, according to Joe Rogers, the Medicaid director at Miami's Jackson Memorial Hospital, the state's largest provider of Medicaid and healthcare for the uninsured.

SPREADING THE WORD

Rogers said many people don't read all the fine print about their health plans. He said the hospital spends about $2 million yearly to inform people about Medicaid, keep them out of the emergency ward for nonemergencies and lead healthy lives.

"Turn on the television and you get bombarded by commercials to eat fast food and drink sodas and generally lead an unhealthy lifestyle. That's who we're competing with: Madison Avenue," Rogers said.

Bush said his effort will get people's attention because "we're going to give them money. Madison Avenue, when you buy a Coke, you don't get money."

Leaks says she made up her mind long ago: She likes Medicaid the way it is.

"I know the system, I know what I have to do," she said. "I don't want to go through this."

Leaks doesn't really have the time for more work.

After Jamal finishes his morning routine, Leaks doesn't wait to watch him get on the school bus. She has to get dressed for work, then head to community college and then back home, where Jamal will be up at 5:30 a.m. the next day, waiting for his nurse, his Barney, and a treatment that Medicaid can't buy: a hug from his mom.

Herald staff writers Lesley Clark and Luisa Yanez contributed to this report.

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