Obama's Medicaid Cuts Add Cost in Kansas

As the recession continues to cut into state budgets, many states, my home state of Kansas -- which is looking at a $510 million budget shortfall next year -- included, are looking for ways to trim the fat.

Unfortunately, the method many are choosing is to cut "optional" programs like the Medicaid waiver.

In January of this year Kansas Governor Mark Parkinson slashed funding for the Medicaid program by 10 percent across the board.

The problem is, Parkinson isn't thinking very clearly in the places he makes his cuts.

The cut to the Medicaid funding would save the state $22 million -- so far, so good, right?


Federal law mandates funding for people who qualify for Medicaid and need to go into a nursing home or other institution. You cannot cut that funding.

What the waiver does is allow Medicaid funding to be used to cover non-hospital expenses, such as in-home care for people with physical disabilities. That program, by federal law, is optional: states are not required to fund those services, and so of course they were on the chopping block. The dirty little secret here is that by cutting that funding, they left $55 million in federal funding on the table.

The even dirtier little secret is it costs about $3,800 per month to keep someone in a nursing home, on average. It costs around $1,800 per month on average to keep someone at home.

Worse, the requirements for the waiver are identical to those for putting someone in a nursing home -- so it's not even good math to cut this funding.

Just getting half the 1,800 or so people who were admitted to nursing homes just since December 2009 back into their homes would save the state a little over $20 million a year. Which is a big chunk of the $22 million they cut. This leaves aside the fact that keeping people in their homes and communities is not only cheaper, but is better for the people on the waiver and for their communities.

These people are often able  to stay in their jobs or otherwise contribute to the community, the organizations who help the disabled employ people to help care for them, and the state saves money on their care -- everyone wins.