- The Washington Times - Wednesday, March 12, 2003

As our nation begins to discuss Medicaid reform, I believe Florida's experience illustrates both the limitations of the current system and the potential for visionary reform. On the one hand, the Sunshine State represents the very picture of the future of America, given our population growth, our cultural diversity and our large number of seniors. Medicaid serves nearly one out of eight Floridians, including 45 percent of our pregnant women, and finances more than $11 billion of our state's health care expenditures.
On the other hand, Florida has also maximized what flexibility exists in the current Medicaid system by aggressively using the Medicaid waiver process. Through waivers we have implemented disease management programs, prescription drug coverage for our seniors and community-based care for many of our most vulnerable citizens, among many other programs.
But Florida's innovations, like those of other states, also illustrate the problem. The current Medicaid system makes flexibility the exception rather than the rule. This limits the quality of care and choices available to our people.
To give just one example, we are very proud in Florida of KidCare, a program that provides health insurance for our children. Despite requiring a premium, appropriate co-payments and more targeted benefits than Medicaid, parents are eager to enroll their children in this program because it offers access to different plans with broader provider networks.
KidCare proves that many parents like many other health care consumers feel the quality of care, as well as access to it, are more important than the long list of statutory benefits. However, federal regulations limit participation in KidCare, these include requirements that two-thirds of all applicants must be diverted into Medicaid rather than take advantage of this program.
The problem is not insufficient waivers from the federal government. Indeed, we are very grateful to have received the support of Health and Human Services Secretary Tommy Thompson for many of our efforts. But federal waivers are not enough. States should not need waivers to: implement the basic elements of a modern health insurance program. States should not need waivers to establish meaningful co-payments; charge fair premiums, target care for certain populations or select geographic areas; implement managed care in its various forms; establish nursing home diversion programs; or implement consumer directed care.
In addition, administering federal waivers has become a bureaucratic nightmare in and of itself. Florida currently has seven waivers in place for long-term care alone, and 13 overall.
Even more frustrating for the states is that federal waivers also have not succeeded in limiting the costs of the program. In Florida, for example, state Medicaid spending is rising by an average of $1 billion a year. It has nearly doubled in six years, and at current rates will equal today's entire state budget in just 12 years. This is all despite our aggressive cost-containment measures, such as maximizing administrative efficiency, reducing prescription drug costs and restricting the growth in provider fees.
Some have suggested that the federal government needs only to send more money to the states. But without real reform, additional funds will only subsidize an antiquated program, the costs of which are rising so fast that not even the federal government can cover them. The reason the nation needs comprehensive Medicaid reform is not so much to help the states, but to help our patients, through a modernized, flexible and realistic health insurance program.
Reform should streamline systems of delivery and unleash consumer choice and participation, as we've seen with KidCare. Reform should recognize the increasing importance of prevention, as well as the shift in needs from acute health care to long-term and chronic care for many populations. And while reform should prioritize choice and access for patients, it should also recognize that only medically necessary treatments and procedures should be covered by government.
Fortunately, reform is not only necessary; it is also more possible now than ever before. I have every confidence that the administration and Congress can work together to create a new Medicaid system that is true to the original vision of the program, while also responding to shifts in demographics, health care needs, and the realities of the health care system.
I and other governors across the nation stand ready to work with national leaders to transform the dialogue we've begun into real reform for all our people.

Jeb Bush, a Republican, is the governor of Florida.

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