The state’s new budget year begins this week. It
will be horrendous. There are draconian cuts to basic state services. Alabama
has a constitutional amendment that mandates a balanced budget. We are in dire
straits but at least we are not engaged in deficit spending like other states.
California is teetering on bankruptcy.
This past year’s budget was bad. Teachers’ and state
employees’ pay was cut this time last year. However, if you think that last
year was bad, you ain’t seen nothing yet. This is the year that the chickens
have finally come home to roost. The federal stimulus manna from Heaven has
provided a lifeline salvation for several years but those dollars are gone.
This fiscal year may well be the worst dilemma since the Great Depression.
My contention is that it is worse than the
Depression years. During that era the state provided fewer services. They had
roads, prisons and the highway patrol but new burgeoning programs, which began
during the Lyndon Johnson Great Society years, did not exist. The Medicaid
program was nonexistent.
Today, Medicaid accounts for an amazing 35% of the
state’s General Fund budget. Most state lawmakers point to this joint
state/federal program as the obvious elephant in the room when it comes to
making ends meet. It is a money eating monster. However, what do you do when
this monster is being fed by a carrot from our good Uncle Sam who does not
worry about deficits? The state gets over a two dollar match from the federal
government for every one dollar spent.
In case you think that this program is a welfare
program, think again. Chances are your Aunt Susie’s nursing home expenses are
being paid by the Alabama Medicaid program. Currently, over 70% of all nursing
home patients in Alabama are on Medicaid.
Tough times call for solutions to problems. Many
experts point to an obvious remedy for Medicaid. Many Alabamians could stay out
of nursing homes if more of an effort were made to provide at home services for
older Alabamians. Home care is not only cost efficient, it is the preferred
route for senior citizens. Alabama’s Medicaid program spent $900 million on nursing
home care in 2011. The average cost to the state for a nursing home patient is
$55,000 per year. The cost for people receiving at home services is $11,000.
Most states are implementing a Medicaid component
known as the elderly and disabled waiver program. This program helps people
with bathroom, cooking and other tasks in an effort to prevent or at least
postpone a move to a nursing home. There are at least 10,000 Alabamians on a
waiting list to enroll in this at home service program. We are lagging woefully
behind other states in getting our folks into this mode of care. According to a
national AARP report last year, Alabama’s Medicaid program relies much more
heavily than most states on nursing homes. In fact, the AARP ranked Alabama’s
long term care services 50th in the country.
There is an inevitable crossroads that Alabama is
facing when it comes to Medicaid. It will only become more acute as our
population continues to age. At home care appears to be one obvious solution.
One thing is for certain, Medicaid will continue to
be problem number one when it comes to balancing Alabama’s budget. It is
uncertain whether cuts to services or operations or implementation of logical
and cost saving measures, like home health care in lieu of nursing home care,
will be enough. Other frequently mentioned revenue solutions are an increase in
the cigarette tax, a state lottery or both.
See you next week.
About the author: Steve Flowers is Alabama’s leading
political columnist. His column appears weekly in more than 70 Alabama
newspapers. Steve served 16 years in the state legislature. He may be reached
at http://www.steveflowers.us.
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