Gibbons drops proposal to end state Medicaid program

By David McGrath Schwartz

Wednesday, Jan. 27, 2010 | 3:50 p.m.

Gov. Jim Gibbons has decided not to push for Nevada to drop out of Medicaid, citing spending patterns, the number of people served under the public health plan and the “apparent demise of the federal health care reform.”

In a news release, Gibbons warned that spending has increased an average of 10 percent a year over the past decade, and “undercuts our ability to fund other state responsibilities and is crowding out education, public safety and infrastructure.”

The governor singled out the state's increasing caseload as the "prime driver" in rising costs. In fiscal 2000, an average of 96,000 Nevadans per month received Medicaid; by the end of 2009 the figure had risen to 238,891.

The Las Vegas Sun first reported last month that Gibbons had instructed the Department of Health and Human Services to seriously examine opting out of Medicaid, which provides health care and services to the poor, elderly and disabled. Most of the money for the program is from the federal government, but under the health care reform bill, the state’s six-year cost was estimated to increase by an additional $613 million. An additional 100,000 people would have received insurance through Nevada’s Medicaid program under the bill.

Gibbons assumes that health care reform is dead. While the upset election of Republican Scott Brown to the open Massachusetts Senate seat stripped Democrats of their 60-seat supermajority in the Senate and imperiled the legislation, its status is far from certain. Senate Majority Leader Harry Reid and House Speaker Nancy Pelosi continue to reconcile the two houses’ versions of health care reform.

Gibbons warned that if health care reform is revived and more costs are shifted to states he “will be forced to revisit the issue.”