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Access to Medicaid seen declining despite cost surge
  By Joan Gralla
NEW YORK (Reuters) - Medicaid is costing the U.S. government and the states $305 billion this year, but the dollars are not flowing down to the physicians who treat the poor, a report by a free-market think tank said on Monday.
The annual cost of Medicaid, the joint state-federal program that provides health care for the needy, has shot up $116 billion in just five years, the Washington, DC-based American Legislative Exchange Council estimated.
"Ironically, despite these massive and ever-higher outlays, access to care for Medicaid patients continues to decline," James Frogue, director of the group's Health and Human Services Task Force, said in the report.
He pointed to a 2002 Medicare Payment Advisory Commission study that found fewer physicians were willing to treat Medicaid patients. The percentage of medical practices open to "all new Medicaid patients" fell by 23 percent from 1999 to 2002, the commission found.
"That tells me that the money is not getting to the people who need it," Frogue said in a telephone interview.
The report said Medicaid "unwittingly" encourages patients to rely on high-cost emergency room visits instead of using less costly primary care doctors.
It also criticized states for using various methods to boost their share of federal matching dollars.
"States, providers and patients all behave as if someone else is footing the bill and therefore have little incentive to spend dollars wisely," the report said.
Currently, the average federal match for a state is 57 percent, according to the report.
This year, the Bush administration again has proposed braking Medicaid's cost spiral by using block grants, which would cap how much a state could spend, according to Barbara Lyons, deputy director of the Henry J. Kaiser Foundation, a Washington-based health-care research foundation.
But a similar plan died last year as states fought back, saying their costs could skyrocket in a public health emergency, for example. This year the Bush administration has scaled back its push for block grants, she said.
A spokesman for the Center for Medicare and Medicaid Services, which runs the two federal programs, had no immediate comment.


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