Wednesday, May 26, 2004


(Jackson, Miss.) — Governor Haley Barbour today signed House Bill 1434, the 2004 Medicaid Reform Bill, which will provide quality health care to those who cannot afford it in a sustainable way that is affordable to the taxpayers.

“During our budget crisis, I am pleased that lawmakers have passed common sense legislation that saves taxpayers money,” said Governor Barbour. “By shifting health care coverage to Medicare, Mississippians who were on the Medicaid rolls will still have health insurance, but the federal government will pay for it. Today we have made strides in managing the program better. We are getting control of Medicaid spending by controlling pharmaceutical costs, pursuing disease management strategies and offering provider and patient education are ways we will more effectively run this program,” he added.

The Medicaid Reform Bill has savings of $106 million and policy reforms that focus on four key areas:

· It authorizes Medicaid to actively re-determine the eligibility of each beneficiary to help establish a “health care home” and disease management for patients. This legislation authorizes Medicaid to actively re-determine the eligibility of each beneficiary, provide a physical examination, and to establish a health care home for each patient. By providing a physical examination to every Medicaid beneficiary, the Division will establish a baseline health status for each individual. This will allow health care providers to better target disease management practices, focusing on prevention.

· It allows the Division of Medicaid to use bulk purchasing power to negotiate lower prescription drug costs. The fastest growing area in Medicaid is in prescription drugs, and much of the money spent by Mississippi taxpayers to provide this service goes to out-of-state pharmaceutical companies, rather than staying with Mississippi’s health care providers. By establishing a mandatory preferred drug list coupled with a prior authorization program, and by seeking a partnership with another state, the Division of Medicaid will use our bulk purchasing power to negotiate lower acquisition costs. By providing the best drugs at the lowest possible cost, both Medicaid beneficiaries and Mississippi taxpayers are protected, with no adverse effect on Mississippi health care providers.

· The legislation maximizes federal matching funds by adjusting the nursing home bed assessment by $2. (This would not be a “tax increase,” since the nursing homes recoup the increase in the form of higher reimbursements from federal funds.)

· The legislation shifts the cost of care to the Federal Medicare Program for those who are “dual-eligible.” That’s 7% of the total Medicaid population. With the advent of prescription drug benefits under the new Medicare law, there is a greater reason for beneficiaries eligible for both Medicaid and Medicare to be covered by the federal government under Medicare. This is the case for appropriately 7% of Mississippians currently covered by Medicaid under the Poverty Level Aged and Disabled program. By shifting health care coverage to Medicare, they will still have health insurance, but the federal government will pay for it starting July 1, 2004. No other state in the nation provides coverage in a program such as PLADs for beneficiaries between 100% and 135% of the poverty level.

· In addition, the Division was instructed through the legislation to apply for two federal waivers. The Governor met with officials from the U.S. Department of Health and Human Services on May 17th, just one week after the Legislature passed the Medicaid reform bill, to ask for federal waivers for Mississippi Medicaid. These waivers are intended to provide coverage for the 5,000 beneficiaries who do not qualify for Medicare and to provide coverage for the end-stage renal disease patients on dialysis, cancer patients on chemotherapy, and organ transplant recipients on anti-rejection drugs.

“This legislation focuses on health care problems and solutions,” said Governor Barbour. “It’s good for Medicaid, and it’s good for Mississippi.”


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Governor Haley Barbour
P.O. Box 139 Jackson, MS 39205
Phone: 601.359.3150 Fax: 601.359.3741