Medicaid cuts could shut state hospitals
Proposal would cost Georgia $2.6 billion in next five years


The Atlanta Journal-Constitution
Published on: 03/04/08

The Bush administration is pressing for rapid changes in Medicaid funding that could cost Georgia more than $2.6 billion during the next five years and potentially shut down dozens of the state's hospitals, health clinics and nursing homes.

"The changes they have are very drastic and damaging to a state like ours," state Health Commissioner Rhonda Medows said Monday.

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Under the proposed changes, state funding to Grady Memorial Hospital would be eliminated, which would virtually guarantee its closure, according to reports sent to federal authorities by Georgia's officials during the past year.

A report released Monday by the House Oversight and Government Reform Committee showed that Georgia would be among the hardest-hit states, unless congressional Democrats can prevent the orders from taking effect.

The administration began sending "policy clarifications" to state health officials last March about the changes, a process that allowed it to avoid the scrutiny and approval of Congress.

The changes would reduce or eliminate funding for a number of Georgia programs. Georgia would have to reduce payments to nursing homes and hospitals. A program that encourages young doctors to train — and possibly remain — at public health facilities would be eliminated. School clinics where medical professionals help students with short- and long-term health problems might be shut down.

The changes are aimed mainly at reducing federal Medicaid costs by restraining how the states use their Medicaid allocation.

The administration said the quick and deep changes would save the federal government $15 billion over five years, but the committee's report shows that the impact on states would be more than three times that amount, $49.7 billion.

"We cannot replace this huge amount of money," Medows said.

Other states facing losses of more than $1 billion each under the regulation changes include California, Texas, New York and Illinois.

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