Medical Society speaks out against Medicaid cuts

05/20/09 5:50PM By Bob Kinzel
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AP File Photo/Alden Pellett
Paul Harrington, Vermont Medical Society
(Host) The Vermont Medical Society is urging lawmakers to reject Governor Douglas's plan to trim an additional $11 million from the Medicaid program.

The group says the cuts will decimate Vermont's network of primary care physicians and increase the cost of private health insurance premiums.

VPRs Bob Kinzel reports.

(Kinzel) Under Douglas's plan, Medicaid payments to doctors would be cut by an additional 4%, payments for elderly patients would be reduced, and a program that provides incentives for primary care physicians to take on additional Medicaid patients would be eliminated.

Paul Harrington is the executive director of the Vermont Medical Society.  He says the combination of these cuts will reduce payments to doctors by almost 10%.  Harrington says the governor's plan will undermine efforts to develop a strong primary care physician network in Vermont and it will force some doctors out of business:

(Harrington) "This is really going to cut into the muscle and really harm Vermont's health care infrastructure for the long term and once you make cuts of this magnitude we're not going to see any increases for the foreseeable future, so it's going to have a very negative impact on Vermont's health care system."

(Kinzel) Jeanne Keller is a health care consultant for a number of business groups. She says the cuts are shortsighted because she says Medicaid patients who lose access to primary care doctors will seek care in a much more expensive setting:

(Keller) "I think that primary care is so close to the margin that when you propose a cut like this... it's going to come up, it's going to squeeze out somewhere else. It's probably going to show up in the emergency room and it's going to cost a lot more money."

(Kinzel) And Keller says when government reduces its payments to health care providers, these costs are shifted over to people with private health insurance. She says the overall cost shift is now responsible for 10% of the cost of private health insurance premiums:

(Keller) "You don't have to cut back anything else if you can just basically pass a premium tax and make the private sector pick up the cost. It's not a back door tax - everybody knows about the cost shift - now there's no excuse really, let's just call it what it is."

(Kinzel) Budget Commissioner Jim Reardon isn't buying the doom and gloom scenario.  He says health care providers can deal with the payment cuts by operating more efficiently:

(Reardon) "We think that health care needs to be reformed and put under control and expenditures reduced so that you don't necessarily when the state reduces its reimbursement result in a cost shift."

(Kinzel) The governor says he'll veto the budget passed by lawmakers earlier this month and he's called them back for a special veto session on June 2nd.

For VPR News I'm Bob Kinzel in Montpelier.

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