In the wrong direction

Friday, Feb. 25, 2011 | 2:01 a.m.

As Gov. Brian Sandoval and the Legislature look to resolve Nevada’s budget crisis, attention is turning to the state’s Medicaid program, a crucial health care safety net for lower-income residents. It is a discussion that is also occurring in states from coast to coast, with governors in some cases recommending severe cuts to balance budgets. The Wall Street Journal reported last month that Republican governors are seeking to change the health care reform law to make it easier for states to reduce Medicaid enrollment.

But Nevada lawmakers should think twice before making sharp cuts that they will likely regret later. Although we understand that some budget reductions are necessary to keep the state afloat, it is possible that cuts to Medicaid could have a devastating effect on many of the 280,000 Nevadans served by the program.

As reported Wednesday by the Las Vegas Sun’s Cy Ryan, Sandoval is proposing to reduce doctors’ reimbursement rates 15 percent for providing health care to Medicaid patients, lower payments for nursing home patients from $189 to $169 a day, and reduce clinical services for mentally challenged children. Other proposals include a 15 percent payment reduction to providers of home- and community-based services to the elderly and elimination of funding to provide glasses for adult patients.

The potential outcomes, though, will be difficult to tolerate because they could include health care rationing and further financial difficulties for hospitals.

Health care rationing is possible because many physicians could decide that it is too costly for them to treat Medicaid patients. Nevadans, though, should not have to put up with rationing because patients who don’t get timely, adequate treatment stand a good chance of developing chronic diseases. That is not only an issue of compassion, but it also could put a further strain on emergency rooms and nursing home facilities and on families of Medicaid recipients.

A legislative budget subcommittee considering Sandoval’s proposed Medicaid cuts learned from Bill Welch, president and CEO of the Nevada Hospital Association, that 10 of Clark County’s 13 hospitals operate at a loss. Lowering Medicaid reimbursement rates would simply add to those losses, adding to the prospect that those facilities could trim services to save money.

One of the biggest losers could be the taxpayer-supported University Medical Center, which has a history of severe financial losses. When the state reduced Medicaid reimbursement rates in 2008, UMC lost $30 million. CEO Kathy Silver told legislators that if they approve more Medicaid cuts, the hospital could lose an additional $6.3 million. She said that’s because other hospitals might be inclined to transfer Medicaid recipients to UMC should doctors in those hospitals refuse to accept them. In the end, county taxpayers would have to foot the bill.

The more rational way for the Legislature to address Medicaid is to keep all options on the table — including possible new revenue streams — rather than go down a path that will harm too many Nevadans.