MISSOURI AWAITS DECISION ON MEDICAID WAIVER FROM FEDS

The specter of state governors who go to Washington, D.C., hat in hand, seeking some favor or another from an omnipotent federal government, is becoming all too familiar. That is what Missouri Gov. Mel Carnahan did last month as he sought a Medicaid waiver from the feds. We sympathize with the governor on this one.

Medicaid is the federal medical care program for poor people. Although it is a federal program, it is administered and partially funded by each of the states. Medicaid represents the fastest growing item in the state budget for Missouri, as it is for most other states, even threatening to become, according to some, "the Pac Man that ate the state budget."

At $2.4 billion in fiscal year 1995, Medicaid is the largest single item in the state budget. Recent years have seen double-digit Medicaid spending increases. Medicaid is a runaway spending program, one that threatens to devour an ever-increasing share of the state budget if some control isn't achieved. The runaway nature of this entitlement program should give us all pause as we watch the health care debate currently under way on Capitol Hill, involving, as it does, the largest entitlement of them all.

What Gov. Carnahan is seeking from the feds is a waiver, or, as he puts it, a super waiver from restrictive federal requirements. The waiver would permit Missouri budget officials to stop -- or at least slow -- this cost spiral.

At the heart of the waiver application is an attempt to steer the state's Medicaid population toward managed care, principally in the form of Health Maintenance Organizations in the urban areas. The thinking is to hold costs down by redirecting state money to preventive care instead of more expensive types of care, such as overuse of emergency rooms.

The standard benefit package would include physician-office benefits, inpatient and outpatient hospital treatment, lab and X-ray services, family planning (not including abortion, to comply with federal and state law), pharmacy, emergency transportation, durable medical equipment, podiatry, transplants, and behavioral and substance abuse.

Carnahan administration explain that under their waiver application, Missouri's Medicaid program would operate in the following manner: Currently uninsured Missourians would pay according to their ability to do so. Thus, the state would collect revenue from these people on a sliding scale basis. For example, we are told that an adult with an income of $14,000 would be able to buy the standard benefit package for $150 a month. The same adult could purchase coverage for a child at $70 a month. A family of four making $1,300 a month would pay about $33 in monthly premiums. The same sized family making $2,300 a month would pay a monthly premium of $325.

The Carnahan administration claims that if Missouri gets the waiver, Medicaid spending over the next five years would be $500 million below what it would otherwise be, while health coverage would be extended to 330,000 Missourians. According to Carnahan administration officials, that figure represents about 55 percent of the Missourians currently without health insurance. If they can accomplish this, it would be no mean feat. We are all Missourians, and they will have to show us.

While we aren't ready to unreservedly endorse what the Clinton and Carnahan administrations might ultimately decide on, at this point it looks as though Gov. Carnahn is pursuing an intelligent course with the waiver. Indeed, it may be the only course that makes sense, if we are to recover a sensible measure of control over runaway Medicaid costs.

A decision on whether to grant the waiver is expected some time this fall, It would be announced by Health and Human Services Secretary Donna Shalala. We await the decision of the Clinton administration.