State officials fear cuts if budget passes

Friday, Dec. 23, 2005 | 7:56 a.m.

CARSON CITY -- The budget reduction bill narrowly passed by the Senate on Wednesday could end up costing Nevada and its local governments.

State officials said the bill, which is pending approval in the House, will cut funds for oversight of foster care programs, a new program to help low-income workers pay for health insurance and Medicaid prescriptions.

Charles Duarte, chief of the state Health Care, Financing and Policy Division, said the bill is being studied and the final effect won4t be known until it passes and government regulations are written.

But as the legislation is now, Duarte said, it will impose a "significant limitation for case management for foster children."

Duarte said a close watch is kept to make sure foster children receive proper medical care, education and homes, but the proposed restrictions will mean the state and Clark and Washoe counties won4t receive as much money.

"These services have to continue," Duarte said, suggesting that state and local governments likely would have to pay more of the tab.

The bill also puts a crimp in a state program to help low-income workers pay for health insurance. The program is designed to give employees in small organizations a subsidy of up to $100 a month for insurance.

Duarte said the program will have to be limited to workers who have children. Assembly Majority Leader Barbara Buckley, D-Las Vegas, led the effort to create the program. She said the federal legislation really hurts the workers in small businesses who are not likely to have health insurance.

Nevada, she said, has one of the highest rates of people who don4t have health insurance, and now it will be less likely an employer will offer the new coverage.

The program will be phased in over several years beginning with 2,000 people during the first year and increasing to 8,000 by the fourth year.

The state must gain a waiver from the federal government to start the program. It will be financed through a combination of federal and state funds with part of the money received from property tax levies.

Because the federal government would cut Medicaid payments, the legislation gives states the option of requiring those people covered by Medicaid to pay a co-payment anywhere from $1 to $2 for prescription drugs. There is no co-payment now.

Buckley said she thinks it is unbelievable that the government wants those who can least afford prescription drugs to come up with a co-payment.

She also complained that government funding will be reduced to the state in its efforts for child support enforcement. Getting a parent to pay support helps keep people from becoming homeless, Buckley said.

The legislation also says Medicaid should not pay for any service if a third party, such as an insurance company or a local or state government program, is paying any part of the bill.

The state or the local government would likely have to pick up the slack if the provision goes through.

"This is a concern. We will have to see how it plays out," Duarte said.

Under the legislation, the federal government will monitor the states more closely to reduce fraud and abuse. The bill makes it tougher for a person to give assets away to family members to qualify for Medicaid.

Cy Ryan can be reached at (775) 687-5032 or at cy@