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Letter details targeted cuts to Medicaid services

Thousands of Washington’s poorest residents will receive a letter early next month informing them that they will lose health care services in the coming year as the state cuts Medicaid spending.

The “Dear Client” letter from the Medicaid Purchasing Administration says “optional” programs such as dental care, hearing devices and hospice care will be eliminated Jan. 1 as a result of Gov. Chris Gregoire’s order in September cutting state spending 6.3 percent to compensate for an expected $1.4 billion budget shortfall through June 2011.

The Medicaid cuts could be averted by the Legislature in the coming session.

The cuts in services detailed in the letter, which has not yet been mailed to Medicaid clients but is posted on the Department of Social and Health Services website, include foot care not considered medically necessary; outpatient physical, occupational and speech therapy; eyeglasses; school-based medical services for children in special education; and Medicare Part D co-payments.

Not listed in the letter are major cuts scheduled to take effect March 1, including an unprecedented elimination of adult pharmaceutical benefits.

Together, the January and March cuts would amount to a savings of nearly $113 million in state Medicaid spending. But because the federal government matches such funding, the state would lose roughly the same amount in federal health care dollars for the poor.

“The only way to take that amount of money out of Medicaid is simply to eliminate optional programs, those not mandated by federal agreement,” DSHS spokesman Jim Stevenson said.

The programs affected serve hundreds of thousands of Washington residents. Adult dental care, for example, is provided to 105,000 clients; adult vision services go to 67,000 clients.

Such a reduction in Medicaid service would be accompanied by layoffs in the Medicaid Purchasing Administration, but “sorting out jobs to be lost is still going on,” Stevenson said.

On Tuesday, Gregoire sent legislative leaders a draft of proposed budget cuts in advance of the upcoming session. Medicaid cuts envisioned in the draft include dental care, school-based medical services, Medicare drug co-payments and funding for medical interpreters.

Not included in the governor’s proposal is the elimination of adult pharmaceutical benefits, which no state has cut, as well as an end to hospice care for the poor, which few states have cut.

The governor is not yet prepared to cut drug coverage for the poor – a move that would save $40 million through June.

As for hospice care to an estimated 2,600 low-income Washingtonians, Gregoire told the CBS News program “60 Minutes” in October that such a cut would be “immoral.”

So far this year, Hospice of Spokane has cared for 122 adults and nine children on Medicaid.

“It’s important to remember these aren’t just figures – these are people,” said Dale Hammond, Hospice of Spokane spokesman. “They’re dying people with very limited financial means. They need help.”

Spokane School District has budgeted about $500,000 for school-based medical services, which are required by federal and state regulations, said Dave Greaves, district director of student support services. Losing Medicaid reimbursement would cost the schools a significant portion of that amount.

Advocates for the poor say Medicaid cuts envisioned by DSHS would be devastating.

“The plan for Jan. 1 is to cut all kinds of services for adults and some children that will almost certainly affect basic quality of life,” said Amy Crewdson, a public benefits attorney for Columbia Legal Services. “For some clients, they could be life-threatening.”



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