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  Home Page » News » Health Reforms Cost To Colorado Budget Unknown

Health reform's cost to Colorado budget unknown

National Conference of State Legislatures fears Congress' changes will hurt finances

by Joe Hanel
Herald Denver Bureau DENVER - After half a year of rancorous debate about health-care reform, little is known about what Congress' plans might cost the states.

All the health-reform bills in Congress aim to insure more Americans by expanding the Medicaid program for the poor.

And because Medicaid is a shared expense of the state and federal governments, that worries Joy Johnson Wilson of the National Conference of State Legislatures.

"This bill, if it were to pass, it makes Medicaid the foundation of our health-care system. And they're underfunding the foundation," Wilson said last week on a conference call with state lawmakers.

The House health-care bill, which passed last week, expands Medicaid and for the first time sets a national standard on whom would qualify.

States would have to pay 9 percent of the expanded costs. The Senate bill has not been released, but it is likely to be similar, said Joan Henneberry, executive director of the Colorado Department of Health Care Policy and Financing.

Henneberry's department has not run the numbers to see what the bills mean for the Colorado budget, because the final numbers will change when the House and Senate combine their bills, she said. As soon as her staff has the final bill, it will run the analysis for the Colorado budget.

"And then we will provide that information to the governor and the Legislature, and they are going to have to start deliberating where the financing is going to come from," Henneberry said.

Other parts of the bill could save money for the state, she said.

In any case, the changes won't take effect until 2013, so the state has some time to plan, Henneberry said.

U.S. Rep. Mike Coffman, R-Aurora, voted against the House bill, along with every other Republican but one. He asked Henneberry for a budget analysis, but she "dodged" his question, he said, because Gov. Bill Ritter supports national health reform.

"This is a state that's talking about cutting education and other programs, and now we're going to have to cut some more" to afford expanded Medicaid, Coffman said.

The National Conference of State Legislatures sent a letter last month to Senate leaders asking for 100 percent funding by the federal government of any Medicaid expansion.

"A lesser commitment from the federal government would shift billions of costs to states and would have serious short- and long-term consequences for state budgets," said the letter.

The nonpartisan Congressional Budget Office says the health-care bills will reduce the federal deficit, but it remains to be seen whether they will drive up costs for the states.

Colorado recently expanded its Medicaid program, and by 2013, it will cover people making $10,830, which is the federal poverty guideline.

The House version of the bill requires Medicaid to be available to people making less than $16,245, or 50 percent above the poverty guideline.

Despite the recent expansion in Colorado, the budget crunch led Ritter to propose cutting the rates the state pays to doctors for seeing Medicaid patients by 2 percent.

Elisabeth Arenales of the Colorado Center for Law and Policy - which pushes for greater investment in social programs - says Colorado's government health system is like a tree.

"It's leafing out. We've got these expansions in the works. But at the same time, we're punching holes in the trunk," Arenales said.

It does no good to expand the number of people who qualify for government health care if doctors won't take them as patients because reimbursement rates are too low, she said.

On the other hand, doing nothing also carries a high cost for states.

A study for the Robert Wood Johnson Foundation, which supports health-care reform, says that within 10 years, Colorado's public and private health-care costs will increase 72 percent under the current system.

The Senate health-care bill could be unveiled as early as today, according to The Associated Press. President Barack Obama has asked Congress to send him a bill by year's end.

jhanel@durangoherald.com'>jhanel@durangoherald.com