public policy

Proposed cuts to RIte Care may endanger $20 million in federal funds

OF THE $37.95 million in ongoing CNOM programs - "costs not otherwise matchable” - outlined in the fiscal 2012 budget, $20.11 million comes from federal funds.
Posted 6/16/11

PROVIDENCE – A budget proposal now under discussion by the R.I. House of Representatives Finance Committee to trim some 6,600 parents and adults from RIte Care by cutting eligibility back to 133 percent from 175 percent of the federal poverty level will put at risk some $20 million in matching federal funds, Secretary Steven M. Costantino of the R.I. Executive Office of Health and Human Services told Providence Business News.

The matching federal funds for ongoing CNOM programs - or “costs not otherwise matchable” - are covered under the state’s global Medicaid waiver. If the state lowers the eligibility requirement of parents now being served under RIte Care, the resulting penalty can result in the loss of all CNOM Medicaid federal funds.

In total, Rhode Island now funds 20 programs, ranging from HIV treatment to home care and day care for seniors, which are paid for with federal CNOM funding.

The proposal to cut eligibility to 133 percent from 175 percent for RIte Care parents will save only about $6 million in fiscal 2012, according to Linda Katz, policy director at The Poverty Institute.

“By rolling back the eligibility requirements, the state will save $6 million in state funds, but we will also forfeit about $8 million in federal matching funds for that specific program, taking a total of $14 million out of Rhode Island’s health care delivery system,” Katz said.

And, she continued, “we will no longer qualify for federal matching funds for all of the CNOM programs the state negotiated with the Feds as part of the Medicaid waiver.”

Katz, quantifying what was at stake, said there are about $38 million in ongoing CNOM programs jeopardized by the loss of $20 million in matching federal funds to help pay for these programs.

Among the programs that the state may be forced to cut back or end, according to Katz, includes one that enables 1,500 Rhode Islanders to receive anti-psychotic medication.

“I would call it penny wise and pound foolish,” Katz said of the proposed cut and the risk of losing federal funds. “Any roll-back in parent eligibility will result in people needing more intensive health care services down the line.”

Research shows that the coverage provided to parents under RIte Care does have an important, positive impact, according to Elizabeth Burke Bryant, executive director of Rhode Island Kids Count.

“Health insurance coverage for parents reduces unmet health needs, improves health care access for both children and parents, and increases the likelihood that children receive preventive care,” Bryant said.

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