Medicaid proposal would reward healthy lifestyles

Monday, September 19, 2005

Health incentives already are being used in the private sector.

JEFFERSON CITY, Mo. -- America is flush with rewards. People with good credit get lower interest rates on loans. Frequent fliers get rewarded with free trips. Some parents even reward their children with cash for good grades. Now some are proposing to reward poor people for good health.

Among the multitude of suggestions presented to a legislative committee looking at ways to overhaul Missouri's Medicaid program for the poor is one that would provide extra benefits to people who are trying to improve their health.

It could work something like this: Try to lose weight and get rewarded with expanded health care benefits. Or turn in biweekly reports about your diet and exercise and get paid in cash.

The concept is that a little motivation could cause people to live healthier, thus lowering their need for medical care and ultimately saving money for the taxpayer-funded Medicaid program.

Simply put: "Good health is cheaper," said James Frogue, director of the Medicaid Transformation Project at the Washington, D.C.-based Center for Health Transformation.

The organization was founded by former House Speaker Newt Gingrich, leader of the 1994 Republican takeover of the House. But Frogue insists to any skeptics that the organization -- and its proposals -- are not political. As evidence, he points to Gingrich's recent appearances alongside Democratic Sen. Hillary Rodham Clinton in support of other proposed health care reforms.

A step ahead of Missouri, Florida already has applied for a federal Medicaid waiver that, among other things, would allow the state to deposit money into "enhanced benefit accounts" for Medicaid recipients who try to remain healthy.

Florida parents could earn money for taking their children to regular dental, vision and doctor's checkups. More cash could be awarded for participating in anti-smoking and weight loss programs, regardless of results. The elderly and the disabled even could earn money for mall walking.

Recipients could use the money in their special accounts for health services not covered by Medicaid -- things like vitamins, routine dental checkups for adults or over-the-counter medicines such as aspirin. The banked money would remain available to recipients even if they leave the Medicaid program.

Health incentives already are being used in the private sector.

The Washington Post reported in February that PacifiCare Health Systems Inc. now offers cash to employees who keep track of their daily food and fitness routines. The business also rewards employees for taking classes on how to stop smoking or manage their diabetes.

Health incentives could be especially important in Missouri, because under a newly enacted law fewer low-income parents are eligible for Medicaid and those who remain no longer receive such things as routine dental coverage or eyeglasses.

Frogue calls incentives for healthy behavior an "absolutely critical part" of what his organization describes as "21st century intelligent Medicaid system."

"There's only one way to truly transform Medicaid, and that's to change behavior at the patient level," Frogue told the Legislature's Medicaid Reform Commission last week.

Among the cost-saving solutions he called mere "window dressing" were cuts to Medicaid eligibility, something Missouri already has done. About 90,000 of the state's 1 million Medicaid recipients are losing their coverage as a result of tighter eligibility standards.

Missouri Medicaid director Mike Ditmore said he would be "extremely excited" if the state were able to adopt a program similar to what Gingrich's organization was suggesting.

But Ditmore didn't seem too optimistic about the prospects of doing so.

Fresh in his mind is a federal court challenge to Missouri's decision to cut coverage of medical equipment such as wheelchair batteries and bedsore-preventing cushions to most adult Medicaid recipients. The lawsuit contends the cuts amount to illegal discrimination based on diagnosis, because children, the blind and pregnant woman still qualify for the benefits.

Ditmore fears the federal Centers for Medicare and Medicaid Services wouldn't look too kindly on an incentive plan that provides more benefits to some Medicaid recipients than to others.

"One of the things CMS is heavy on is comparability, so you're not giving to one categorical group something you're giving to another," Ditmore said, and that could be "even more so on a person-by-person basis."

EDITOR'S NOTE: Capitol Correspondent David A. Lieb covers Missouri government and politics for The Associated Press.

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