[Congressional Record (Bound Edition), Volume 155 (2009), Part 18]
[Extensions of Remarks]
[Pages 24501-24503]
[From the U.S. Government Publishing Office, www.gpo.gov]




  GOVERNORS OF CALIFORNIA AND FLORIDA EXPRESS CONCERNS WITH UNFUNDED 
                       MANDATES IN HEALTH REFORM

                                 ______
                                 

                            HON. MIKE ROGERS

                              of michigan

                    in the house of representatives

                       Wednesday, October 7, 2009

  Mr. ROGERS of Michigan. Madam Speaker, I rise today to express 
concerns regarding health reform proposals which would create unfunded 
state mandates. Legislation currently before the House would 
dramatically expand the Medicaid program and place over $35 billion in 
new liabilities on state budgets over the next ten years. In addition, 
these proposals would expand the federal government's role in 
administering Medicaid, which would severely handcuff states' ability 
to run their own programs and preempt state authority to manage 
Medicaid eligibility and benefits.
  Over the last several weeks, governors have expressed concerns over 
these proposals. I would like to submit for the Record the following 
letters from the governors of California and Florida:

                                                    July 31, 2009.
     Hon. Harry Reid,
     Majority Leader, U.S. Senate,
     Washington, DC.
     Hon. Mitch McConnell,
     Minority Leader, U.S. Senate,
     Washington, DC.
     Hon. Nancy Pelosi,
     Speaker of the House, House of Representatives,
     Washington, DC.
     Hon. John A. Boehner,
     Minority Leader, House of Representatives,
     Washington, DC.
       Dear Senator Reid, Senator McConnell, Madam Speaker and Mr. 
     Boehner: I appreciate your commitment and hard work toward 
     reforming the nation's health care system. I think we can all 
     agree that the current system is not working as it should, 
     and I have long supported a significant overhaul. Costs 
     continue to explode, while tens of millions remain uninsured 
     or underinsured. Many families are one illness away from 
     financial ruin--even if they do have insurance. We have the 
     greatest medical technology in the world at our fingertips, 
     yet Americans' health status lags behind many countries that 
     spend less than half what we do per capita. Any successful 
     health care reform proposal must be comprehensive and built 
     around the core principles of cost containment and 
     affordability; prevention, wellness and health quality; and 
     coverage for all.


                   Cost Containment and Affordability

       Cost containment and affordability are essential not only 
     for families, individuals and businesses, but also for state 
     governments. Congress is proposing significant expansions of 
     Medicaid to help reduce the number of uninsured and to 
     increase provider reimbursement.
       Today, California administers one of the most efficient 
     Medicaid programs in the country, and still the state cannot 
     afford its Medicaid program as currently structured and 
     governed by federal rules and regulations. The House 
     originally proposed fully funding the expansion with federal 
     dollars, but due to cost concerns, members decided to shift a 
     portion of these expansion costs to states. I will be clear 
     on this particular proposal: if Congress thinks the Medicaid 
     expansion is too expensive for the federal government, it is 
     absolutely unaffordable for

[[Page 24502]]

     states. Proposals in the Senate envision passing on more than 
     $8 billion in new costs to California annually--crowding out 
     other priority or constitutionally required state spending 
     and presenting a false choice for all of us. I cannot and 
     will not support federal health care reform proposals that 
     impose billions of dollars in new costs on California each 
     year.
       The inclusion of maintenance of effort restrictions on 
     existing state Medicaid programs only compounds any cost 
     shift to states. We simply cannot be locked into a cost 
     structure that is unsustainable. Governors have three primary 
     ways to control Medicaid costs: they can adjust eligibility, 
     benefits and/or reimbursement rates. Maintenance of effort 
     requirements linked to existing Medicaid eligibility 
     standards and procedures will effectively force state 
     legislatures into autopilot spending and lead to chronic 
     budget shortfalls.
       The federal government must help states reduce their 
     Medicaid financing burden, not increase it. A major factor 
     contributing to Medicaid's fiscal instability, before any 
     proposed expansion, is that the program effectively remains 
     the sole source of financing for long-term care services. 
     Therefore, I am encouraged by congressional proposals that 
     create new financing models for long-term care services. 
     Proposals that expand the availability and affordability of 
     long-term care insurance are steps in the right direction, 
     but they must be implemented in a fiscally sustainable way. 
     More fundamentally, however, the federal government must take 
     full responsibility for financing and coordinating the care 
     of the dually eligible in order to appreciably reduce the 
     cost trend for this group. This realignment of 
     responsibilities is absolutely essential to controlling costs 
     for this population, while ensuring that state governments 
     will be better positioned to fill in any gaps that will 
     undoubtedly arise from federal health care reform efforts. I 
     also encourage Congress to incorporate other strategies to 
     help stabilize Medicaid costs for states.
       Delaying the scheduled phase-out of Medicaid managed care 
     provider taxes pending enactment of new Medicaid rates, 
     reimbursement for Medicaid claims owed to states associated 
     with the federal government's improper classification of 
     certain permanent disability cases, and federal support for 
     legal immigrant Medicaid costs are examples of federal 
     efforts that could provide more stability to state Medicaid 
     programs. Moreover, given the fiscal crisis that many states, 
     including California, are experiencing, I strongly urge 
     Congress to extend the temporary increase in the federal 
     matching ratio to preserve the ability of state Medicaid 
     programs to continue to provide essential services to low-
     income residents pending full implementation of national 
     health reform.


           Prevention, Wellness and Health Quality Prevention

       Wellness and health promotion, along with chronic disease 
     management, can help to lower the cost curve over the long 
     run and improve health outcomes in the near term. This was 
     one of the cornerstone pieces of my health care reform 
     proposal in California, and I continue to believe it should 
     be a key piece of the federal efforts. Prevention, wellness 
     and chronic disease management programs should include both 
     the individual and wider population levels.
       At the individual level, proposals to provide refunds or 
     other incentives to Medicare, Medicaid and private plan 
     enrollees who successfully complete behavior modification 
     programs, such as smoking cessation or weight loss, are 
     critical reforms. To ensure they are widely used, individual 
     prevention and wellness benefits should not be subject to 
     beneficiary cost sharing.
       Because individuals' behaviors are influenced by their 
     environments, health reform must place a high priority on 
     promoting healthy communities that make it easier for people 
     to make healthy choices. California has demonstrated through 
     its nationally recognized tobacco control efforts that 
     population-based strategies can be effective and dramatically 
     change the way the people think and act about unhealthy 
     behaviors, such as tobacco use. A similar model, community 
     transformation grants, has been advanced in the Senate 
     Committee on Health, Education, Labor, and Pension 
     legislation, and it should be included to support policy, 
     environmental, programmatic and infrastructure changes that 
     address chronic disease risk factors, promote healthy living 
     and decrease health disparities.
       Quality improvement measures are also critical to health 
     reform. The House proposal for a Center for Quality 
     Improvement to improve patient safety, reduce healthcare-
     associated infections and improve patient outcomes and 
     satisfaction is a positive step. Coordinated chronic disease 
     management is necessary to improve outcomes for chronically 
     ill people.
       Systematic use of health information technology and health 
     information exchange, including access for public health 
     agencies, is vital to providing the necessary tools to 
     measure the success of quality improvement efforts. Finally, 
     investments in core public health infrastructure can be 
     facilitated through the creation of the proposed Prevention 
     and Wellness Trust.


                            Coverage for All

       Coverage for all is also an essential element of health 
     care reform and I believe an enforceable and effective 
     individual mandate, combined with guaranteed issuance of 
     insurance, is the best way to accomplish this goal. The 
     individual mandate must provide effective incentives to help 
     prevent adverse selection that could occur if the mandate is 
     too weak. Creating transparent and user-friendly health 
     insurance exchanges to help consumers compare insurance 
     options will also help facilitate participation. States 
     should maintain a strong role in regulating the insurance 
     market and have the ability to maintain and operate their own 
     exchanges, with the understanding that some national 
     standards will need to be established. California has a long 
     history of protecting consumers through our two separate 
     insurance regulators, one covering health maintenance 
     organizations and the other monitoring all other insurance 
     products. Maintaining a strong regulatory role at the state 
     level is in the best interest of consumers, and I urge 
     Congress to maintain this longstanding and effective 
     relationship as you design these new market structures.
       I hope our experience in California working toward 
     comprehensive health care reform has informed the debate in 
     Washington. There will be many short-term triumphs and 
     seemingly insurmountable roadblocks for Congress and the 
     nation on the road to comprehensive health care reform. We 
     must all remain focused on the goal of fixing our health care 
     system and remember that we all have something to gain from 
     the reforms, and we all have a shared responsibility to 
     achieve them. I look forward to working with you as you move 
     forward on this desperately needed legislation.
           Sincerely,
                                            Arnold Schwarzenegger,
     Governor, California.
                                  ____

                                               September 17, 2009.
     Hon. Bill Nelson,
     U.S. Senate, Hart Senate Office Building, Washington, DC.
       Dear Senator Nelson: Thank you for your valuable work on 
     behalf of Floridians in the United States Congress. I am 
     pleased with our ability to work together on issues important 
     to our state, including the health and well being of our 
     residents.
       We can all agree that we need to work together to make 
     quality health care more affordable and accessible, 
     especially to those who currently do not have health 
     insurance. I stand united with my fellow governors; however, 
     with our concerns about how Congressional proposals may 
     affect our ability to manage scarce state resources.
       In the last year, enrollment in Florida's Medicaid program 
     has increased from 2.2 million in July 1, 2008 to 2.63 
     million in July 2009, causing a strain on our state budget. 
     Congressional proposals would increase those numbers by 
     expanding Medicaid eligibility. Under the U.S. Senate Health, 
     Education, Labor and Pensions (HELP) Committee proposal for 
     example, more than 1.46 million people would be added to our 
     current Medicaid caseload in Florida at a cost of $4.93 
     billion for the next fiscal year.
       Although providing more access to health care for 
     individuals and families in our struggling economy is an 
     affable goal, our preliminary Florida estimates show that in 
     the following year (State Fiscal Year 2010-2011), once the 
     American Recovery and Reinvestment Act Federal Medical 
     Assistance Percentage funds have been exhausted, the impact 
     increases as more than 1.72 million people are expected to be 
     added to our case load at a cost of $5.875 billion.
       Some Members of Congress have indicated that states should 
     shoulder some of the burden to fund the expansion of Medicaid 
     at a time when our economy and residents are struggling. To 
     pay for this expansion, states fear the need to cut critical 
     services like education or public safety to add more money to 
     Medicaid. This would have a crippling effect on Florida's 
     state economy and the national economy.
       In addition, state Medicaid programs currently take on the 
     burden of financing long term care services for our aging and 
     disabled residents. Due to our large elderly population, 
     Florida is estimating expenditures of $4.3 billion for state 
     fiscal year 2009-2010 (this includes coverage of 
     institutional care, home and community based waiver and our 
     nursing home diversion waiver services). Medicaid is the 
     primary payor for nearly two- thirds of all nursing home 
     residents in the state. While the U.S. Senate HELP proposal 
     and the House bill call for the creation of a new voluntary 
     federal insurance program for community-based long-term care 
     services, the Congressional Budget Office has questioned the 
     long term viability of this provision. Any federal health 
     care reform discussion must include a combined federal and 
     state approach to the financing and provision of Medicaid and 
     long term care services.
       Lack of health insurance is the greatest barrier to 
     accessing health care. With nearly four million Floridians 
     currently lacking health insurance, our state has launched 
     initiatives designed to reduce that number and assist those 
     who need prescription medication. Many of these programs can 
     serve as

[[Page 24503]]

     examples to our nation. I have attached a brief summary 
     outlining several of these successful programs Florida is 
     using to address the health care needs of our residents, 
     while targeting ways to reduce costs to our health care 
     system.
       The partnership between our state and our federal 
     government is critical in enabling Florida to serve its 
     residents, and I stand ready to work with you to address 
     those issues which are most essential in health care reform: 
     access and affordability. Our goal should remain clear: 
     maintaining a high quality health care system which allows 
     individuals to get treatment when they need it. I hope I can 
     count on your support to work together on solutions to 
     improve care at the same time as providing sustainability in 
     essential programs like Medicaid through sound financing 
     options at the state and federal levels.Thank you for your 
     consideration and support.
           Sincerely,
                                                    Charlie Crist,
     Governor, Florida.

                          ____________________