A Medical Device Daily

Proposed changes to federal Medicaid guidelines would reduce payments to states by nearly $50 billion over five years — more than three times the federal estimates, according to a report released by House Oversight and Government Reform Committee Democrats on Monday.

The changes include provisions that would prohibit states from using federal Medicaid funds to help pay for physician training, place new limits on Medicaid payments to hospitals and nursing homes operated by state and local governments, and limit coverage of rehabilitation services for people with disabilities, including those with mental illnesses.

The Office of Management and Budget has estimated that changes would reduce federal payments to states by about $15 billion over the next five years. The federal government, which currently pays about 57% of the total cost of Medicaid, is expected to spend about $204 billion on the program this fiscal year.

The report included a financial breakdown of how each of the rule changes would affect each state. The report stated that in “a program like Medicaid, which is operated by states on a day-to-day basis and is famous for its variation from state to state, the lack of state-specific estimates represents a major failure in transparency.” However, the report stated that the estimates “should be viewed with caution” because not all states responded to the committee’s Jan. 16 request for cost estimates of the rule changes.

In addition, states that did respond used different methodologies to calculate their estimates; some states did not provide estimates for all of the regulations; and some said they were unable to analyze some regulations’ full impact.

Committee Chair Henry Waxman (D-California) said, “As the economy tips into recession, the last thing we should be doing is taking federal funds from states, especially funds that are supposed to help people with their health and medical expenses.”

But Jeff Nelligan, a spokesman for CMS, said that the report is “not credible,” because containing questionable calculations and lacking supporting evidence.

He said that the report failed to provide a variety of information concerning its assumptions and expenditure reports and no analysis of how states might respond to the cutbacks.

Dennis Smith, director of the Center for Medicaid and State Operations at CMS, also said the report lacked credibility because of “gaps” and “assumptions.”

The first regulation, which limits federal reimbursement for ancillary services, such as helping beneficiaries find jobs or housing, took effect on Monday. Congress has placed a moratorium on four of the rules and likely will extend the moratorium into next year, according to some sources.

HHS, Mexican states in cross-border pact

HHS Secretary Mike Leavitt and the Secretary of Health of the United Mexican States, Dr. Jose Angel Cordova, have signed a memorandum of understanding (MOU) designed to strengthen cross-border cooperation to address public health, medical and scientific issues.

They said they will work together on common health problems. The two countries have a history of collaboration in public health, and the document updates an MOU that began in 1996, revised in 2001.

“The United States enjoys a solid friendship with Mexico, and our two nations are stronger when we work together to improve the health of our citizens,” Leavitt said. “A commitment to the health and safety of our nations, and to the spirit of cooperation, provides opportunities for growth in science, cross-cultural training, healthcare delivery and the protection of our people.”

Through the MOU, the U.S. and Mexico declare their intention to focus collaborative efforts on public health emergency preparedness and response; the health concerns of vulnerable groups; training; disease prevention and health promotion; and the detection, surveillance and reporting of infectious and chronic diseases.

The two secretaries signed the renewed MOU at the conclusion of the plenary session of the annual meeting of the U.S.-Mexico Border Health Commission. The secretaries, who chair the commission, were joined by FDA commissioner Andrew von Eschenbach; the HHS assistant secretary for preparedness and response, W. Craig Vanderwagen, MD; Maki Esther Ortiz Dominguez, deputy secretary for quality and innovation in the Mexican Federal Secretariat of Health; the commissioner of the Mexican Federal Commission for Protection Against Sanitary Risks, Juan Antonio Garcia Villa; and representatives from the 10 U.S. and Mexican border states.

Last November, Leavitt and Cordova signed a declaration of intent with Canada that spells out how the three countries can offer each other assistance during a public health emergency.