A plan to slash $122 million from Virginia's Medicaid program during the next two years encountered fierce criticism today from a coalition of nursing home operators and public interest groups that charged that the cuts spell disaster for the elderly.
The plan -- recently proposed by a special state Board of Health task force -- criticizes the state's profitable nursing home industry the hardest by placing sharp new limits on reimbursements for care of the indigent.
The task force has proposed other cutbacks that, while not as severe as those offered by the administration of former Republican governor John N. Dalton, still would directly reduce medical services for about 150,000 recipients. Longtime services under the Medicaid program, such as free eye examinations, dental services, and medical clinic visits, would be eliminated.
"This is really very sad," said state Del. Dorothy McDiarmid of Fairfax outside an emotionally charged public hearing that saw a parade of over 85 witnesses denounce the task force proposals. "It's going to have a horrible effect on the poor."
The proposal, which must be approved by the Board of Health and Gov. Charles S. Robb, is only the latest of several attempts by Virginia officials to close a widening gap between Medicaid costs and revenues. The Dalton proposals, which would have dropped nearly 50,000 indigent patients from the rolls, were scrapped after a storm of criticism from advocacy groups and health professionals.
That left the deficit problem in the lap of the new Robb administration, whose Medicaid administrator, Bruce C. Kozlowksi, said the complaints by today's witnesses were "no different than what I anticipated. It's the same thing I've heard for the past 10 years."
Among the other task force proposals that drew criticism today:
* A limit on an individual's visits to physicians' offices of 12 per year. This would save the state $1.3 million, but advocacy groups charge it would be counterproductive because recipients will be forced to use more expensive hospital emergency rooms.
* An end to guarantees that nursing home residents who are hospitalized for more than 15 days can return to the same nursing home bed. The task force says this would save $1.5 million because the state would no longer be reimbursing the homes for empty beds. Critics say it would cause deep emotional traumas for the elderly. Once hospitalized, a nursing home resident would suffer from "loneliness and anxiety from wondering 'Where do I go from here?' " said Marian Doliver, president of Virginia Friends and Relatives of Nursing Home Residents.
* Elimination of coverage for the drug Valium. State officials say the drug, taken by about 8,000 Medicaid recipients, is widely abused. The drug's New Jersey-based manufacturer, Hoffmann-LaRoche Inc., has been intensively lobbying against the proposal. The firm's lobbyist, John B. Dalton, emphasized today that the drug has important value as a sedative and muscle-relaxer.
It is the nursing home industry, however, that has mounted the most aggressive campaign against the task force proposals, charging that the reductions in the state's reimbursement formula will mean deteriorating care for elderly patients. The new formula would reimburse the homes for care of Medicaid patients about $33.50 per day, while the operators claim their average costs are about $39 per day.
Walter Marston, a partner of lobbyist William G. Thomas of Alexandria who has been retained by the nursing home operators, said that the reimbursement formula was "short-sighted and counterproductive" and would almost certainly lead to a spate of lawsuits from the industry if adopted.
State health officials say privately that the operators are less concerned about the reimbursement cutback than another, less-publicized proposal that would place controls on the sale and resale of nursing homes. Under current practice, the state's Medicaid program subsidizes the sales by reimbursing purchasers for their depreciation and interest expense -- a subsidy that, officials say, has driven up the cost of homes at state expense.
"I don't think we ought to be expending the public's money for real estate ventures," said Kozlowski.