Christie proposal to slash Medicaid by $540 million puts NJ at center of national debate

By the AP –

TRENTON, N.J. — As states across the country look for ways to trim billions off their spending on Medicaid, New Jersey is garnering particular attention for a proposal that opponents characterize as an unprecedented and draconian attempt to balance the state’s precarious budget on the backs of society’s most vulnerable populations.

The debates taking place in statehouses, clinics and living rooms crystalize the unfortunate truth about economic recessions: Citizens rely most on public services just when the government has the least money to spend on those services.

In New Jersey’s case, changes would mean a parent of two earning more than $103 per week would be ineligible.

As a joint federal-state venture, Medicaid changes provide endless opportunities for political collision. New Jersey’s proposal to cut more than half a billion dollars occupies the delicate intersection between the Republican governor’s budget, the Democratic Legislature’s priorities, President Barack Obama’s health care reforms and U.S. Rep. Paul Ryan’s proposed entitlement overhauls.

The 46-year-old Medicaid program provides government-funded health care to low-income people at risk due to disability, age, chronic illness or other circumstances. It was expanded in 1997 to cover more individuals through the Children’s Health Insurance Program, known in New Jersey as NJ FamilyCare. States have substantial flexibility to determine the “who,” ‘’what” and “how” of services offered.

At issue in New Jersey is a $540 million cut to state Medicaid funding that Gov. Chris Christie proposed for next year’s budget. About $240 million comes from specific program cuts, such as $140 million dropped from nursing home coverage.

“If the cuts go through, it could mean more dangerous falls, not getting my medicine,” said Maureen Liberatore, 77, whose care in a Cinnaminson, N.J. nursing home is Medicaid-funded.

Christie hopes to save $300 million through a “comprehensive Medicaid waiver.” States submit waivers to the federal government requesting permission to restructure their program outside the core parameters for what they must cover.

A provision of the health care changes Obama championed prevents states from turning away previously eligible residents without such a waiver. It’s a stop-gap measure until 2014, when another part of health care reform will expand Medicaid to anyone earning less than 133 percent of the poverty level.

“The state is effectively telling these families to wait until 2014 to get coverage again,” U.S. Sen. Robert Menendez, D-N.J., said Friday. “Unfortunately, there is no such thing as a waiver for getting cancer.”

About 1 million of New Jersey’s nearly 9 million residents are enrolled in Medicaid or NJ FamilyCare. Even with the proposed cuts, the state will spend almost $5 billion to fund the programs in 2012. The federal government chips in about an equal amount.

“We must do these things, not only to fill the hole created by the loss of over a billion dollars of federal stimulus money since 2010, but because it is the right thing to do,” Christie said in his budget address. “Medicaid’s growth is out of control.”