Sen. Max Baucus, D-Mont. Photo: WDCpix

It happens in every recession: Medicaid enrollment leaps at precisely the same time that states are least able to afford the additional costs. The structural flaw has left state lawmakers threatening program cuts, Congress scrambling to find emergency funds to prevent a coverage crisis, and children’s health advocates urging an overhaul in the way Medicaid is funded.

Trouble is, the Democrats’ health reform proposals do nothing to address the problem.

Despite the Medicaid expansion at the center of both the House and Senate bills, neither chamber takes aim at the underlying funding flaws of the program, which is bankrolled by a combination of state and federal money. That decision, policy experts warn, leaves some of the poorest folks in the country vulnerable to losing health care coverage during economic downturns when they’re likely to need it most.

“From time to time, we’re going to have these economic downturns,” Stan Dorn, senior health policy researcher at the Urban Institute, said last week during a kids’ health forum on Capitol Hill. “Rather than react in the same panicked way every single time, is there a way we can rethink how we structure the underlying program?”

The answer is yes — and lawmakers are well aware of it — but Congress isn’t acting on it. Indeed, last November, just days after the Democrats won the White House, Senate Finance Committee Chairman Max Baucus (D-Mont.) proposed to create a trigger that would automatically hike the federal share of Medicaid funding when states, which are required by law to balance their budgets, hit tough times.

“Medicaid must be strong and stable so that eligible individuals can rely on it, especially in times of economic distress,” the Baucus paper explained.

Dorn endorsed that approach, arguing that such a mechanism would “provide automatic counter-cyclical relief so that when state conditions decline, federal help is forthcoming, and when state conditions improve, federal help retracts.”

“Not only would that help states,” Dorn added, “it would mean that federal dollars, which are in short supply, … would be much more closely targeted to need.”

Yet less than a year later, when Baucus unveiled his health reform proposal — legislation featuring a Medicaid expansion up to 133 percent of the federal poverty level — the funding trigger was noticeably absent. Baucus’ office did not respond to requests for comment Tuesday, but some health policy observers say it’s likely that cost concerns kept that provision out of the final bill.

Without such a trigger, Congress has been forced to step in twice in the last decade to help states weather recessions without dumping thousands of Medicaid patients. Between 2001 and 2002, for example, Medicaid enrollment jumped 8.6 percent, while tax revenues fell 7.5 percent, according to the Government Accountability Office. The trend led Congress in 2003 to provide $20 billion in emergency funding to stabilize program enrollment.

More recently, the economic stimulus bill contained $87 billion to provide a 6.2 percent increase in federal Medicaid funds, with additional help going to those states with the highest unemployment. The money was conditional: states accepting it could not restrict their eligibility requirements. All complied — with good reason. The Kaiser Family Foundation reported last month that state Medicaid enrollment jumped by an average of 5.4 percent in the year that ended July 1.

But that extra funding expires at the end of 2010, leaving kids’ health care advocates concerned about the future — particularly in high-unemployment states like Michigan, Nevada, Rhode Island and California, where Medicaid rolls are mostly likely to swell most rapidly.

“We could fully expect major cuts in Medicaid if there isn’t some continuation of that fiscal relief,” said Jocelyn Guyer, co-executive director at Georgetown University’s Center for Children and Families.

Some lawmakers have the problem on their radar. The House health reform bill, for example, would extend the additional Medicaid funding through June of 2011 – a provision the Congressional Budget Office estimates will cost $23.5 billion.

Meanwhile, however, the legislative uncertainty is forcing state health officials to craft their budgets as if the funds will expire Dec. 31, 2010 — just halfway through most state budget calendars.

Nate Checketts, head of Utah’s Children’s Health Insurance Program, described the potential effect that expiration would have on the state. Before the stimulus bill became law in February, he said on Friday, state lawmakers had worked out all the details of a plan to cut adults, including medically needy folks, from the Medicaid rolls. The stimulus bill prevented that step, but with the enhanced funding set to expire, “those items are back on the table again,” Checketts said.

The current Medicaid funding scheme also creates dilemmas of moral hazard. Checketts noted that, before the stimulus bill passed, Utah had considered creating an emergency Medicaid fund, to be fed in the good years and tapped in the lean ones. “When the stimulus funds continue to come in the bad years,” Checketts said, “it sort-of undercuts that concept of needing to have a Medicaid rainy-day fund.”

“States are beginning to act as if these funds may always come,” he added. “There needs to be a decision about whether that’s really going to happen [in the future]. If not, states need to change their behaviors.”

The saga highlights the central dilemma facing Democratic leaders as they push forward with their sweeping health reform proposals: how to cover tens-of-millions of uninsured Americans while keeping new federal costs to a minimum. The expansion of Medicaid, an essential component of both the House and Senate bills, has been an attractive way to extend that coverage precisely because it’s cheaper than other alternatives. But the low cost comes at a price.

Indeed, according to a September survey conducted by the Center for Studying Health System Change, only about 40 percent of physicians accept all new Medicaid patients — versus 58 percent for Medicare patients — and roughly 28 percent don’t accept any new Medicaid patients at all. For dental care, the figures are even worse. Less than 27 percent of dentists surveyed by the American Dental Association in 2007 said they treat Medicaid-insured patients, leading to severe access problems surrounding oral health. The trends have raised questions about the value of an insurance program that few providers accept.

The House bill tackles the reimbursement issue head on, increasing Medicaid rates for primary care services to 100 percent of Medicare rates by 2012. Initially, the federal government would pay for the entire rate hike, though states would assume 9 percent of the increase beginning in 2015. The reform doesn’t come cheap. That provision alone would cost taxpayers $28.7 billion over the next five years and $57 billion over the next 10, the CBO estimates.

In the eyes of many experts and advocates, even if the House reimbursement changes don’t pass as part of the final bill, the expansion of Medicaid represents a step in the right direction. “As bad as Medicaid reimbursement is, it’s better than zero,” Dorn said. “For low-income folks, it will certainly be better than being uninsured.”

Yet Checketts said that Utah health officials — like those in many states — are wary of the expansion, which they estimate could double Utah’s Medicaid population.

“I don’t think [doctors and dentists] would be able to handle that with the current reimbursement rates,” Checketts said. “Some sort of change will have to be made.”

Elsewhere in Minnesota news this morning …

STATEWIDE: Ask Al more. Five dollars and cab fare to New York City will get you a lunch audience with Sen. Franken. [Washington Post's In the Loop]

TWIN CITIES: Random acts of criminality on YouTube. Police are on the trail of local thugs who posted a clip showing them attacking people on bikes and on foot. [Fox 9]

PRIOR LAKE: Native Americans get ready for Copenhagen. They want a say in climate-change talks. [Associated Press]

DASSEL: Steve Dille out. The Republican state senator won’t run again; he was one of the eight GOPers who helped override Gov. Pawlenty’s veto of transportation funding in 2008. [Litchfield Independent Review; Polinaut]

PRAIRIE ISLAND: Lege has last say on nuke storage. The people’s reps at the state Capitol could reverse a regulatory OK for Xcel Energy to store more nuclear waste. [Rochester Post-Bulletin]

STATEWIDE: Or possibly universe-wide? Minnesota Public Radio’s designs on dominance in news. [Braublog]

A 60-year-old Port Huron, Mich. woman called up the Kentucky-based customer service center for the Gannett-owned Times Herald of Port Huron to express her anger over the editorial, which criticized Republican U.S. Rep. Candice Miller for attending the rally. The Nov. 12 editorial called out protest signs that depicted Obama as “Sambo” and others that showed the Holocaust imagery, as well as protesters who chanted “Nazi, Nazi.”

The editorial concluded by calling on Miller to apologize for attending the Bachmann-organized event, which it characterized as a “GOP festival of hate.”

No charges have been filed against the woman, but an investigation is ongoing.

CREW’s Matt Jacob told the Minnesota Independent that House members aren’t supposed to use their congressional websites to urge public action on behalf of or against pending legislation.

In its letter (pdf) CREW cited this House rule:

The content of a Member’s Web site … [m]ay not include grassroots lobbying or solicit support for a Member’s position.

Bachmann’s website, CREW says, urged “[t]he people” to travel to Washington, D.C. “and tell their Representatives to vote no to a governmental take-over of one-fifth of our economy.”

Bachmann announced the Nov. 5 “House Call” rally on Fox News on Oct. 30. That left enough time for Bachmann to meet the five-day lead time required to apply for a permit for an event on the Capitol grounds, according to a U.S. Capitol Police guidelines that CREW includes in its supporting documents (pdf).

CREW’s complaint doesn’t cover another apparent aspect of Bachmann’s official efforts as impresario of the Capitol-steps anti-health care rally. According to the Savage (Minn.) Pacer newspaper, Bachmann’s staff helped a man not from her congressional district to find a nearby bus from Eden Prairie, Minn. headed to Washington, D.C. for the rally:

So he called the Savage Chamber of Commerce trying to get a carpool together of other interested business owners. No one contacted him, so he began asking friends and other business owners and then contacted Rep. Michele Bachmann’s office where he found out about the buses leaving Eden Prairie.

The OCE is a newly formed body that has been on the receiving end of sniping from the longer-in-the-tooth but slow-off-the-mark House Ethics committee. Jacob told MnIndy the tally of CREW’s complaints to the OCE is so far “not a huge number.”

Both complaints involved Bachmann’s Nov. 5 rally against health-care reform in front of the U.S. Capitol.

Israel, of New York, used YouTube to voice his displeasure with prominent protest signs at the Bachmann event depicting Holocaust victims. A statement Bachmann released this week contains an apology of a sort.

On his TV show, Stewart took Hannity to task for inserting footage from another, larger rally into scenes from Bachmann’s event. Here’s Stewart’s take on Hannity’s sort-of apology.

The email (pdf), headlined “Write Your Senators!,” provides links to the company’s online letter-writing template and offers form letters employees can customize for writing to legislators and to local papers. The communique states that “all activity is voluntary and you may express any position you may have,” but as Judy Dugan of Consumer Watchdog suggests, employees “wouldn’t dare to speak against the company position unless they’ve already got a new job lined up.”

In August, UnitedHealth — one of the country’s largest health insurance providers – sent a letter to employees urging them to write to their representatives about about health care reform and to attend town hall meetings on the topic. One caller to a UnitedHealth health reform hotline was reportedly encouraged to attend a tea party and directed to a listing of events hosted by the rightwing America’s Independent Party.

Media Matters has a rundown of Fox’s past video trickery.

Here is Hannity’s original Fox News segment about Bachmann’s rally:

Update: On Wednesday’s show, Hannity acknowledged that Fox used the wrong footage.

“[The LGBT provisions] were highlighted in a story posted on the left newsblog Minnesota Independent,” wrote Tom Prichard, president of the religious right group, on Tuesday. “They correctly conclude that the focus of pro-life and social conservatives was the battle over abortion coverage mandates in the bill. But then go on to point out a number of provisions slipped in by homosexual activists ‘unnoticed.’ [sic]”

The Family Council says that opposing the “use of our taxpayer dollars to kill, eventually, millions of unborn children, was of supreme importance.”

He continued, “That, however, doesn’t negate the significance of many of provisions [sic] which seek to redefine and thus undermine the basic structure of the natural family. This is, of course, where homosexual activists ultimately want to go.”

But, the group was quick to note its opposition to the LGBT items passed on Saturday. “The provisions show homosexual activists are once again turning to government as a vehicle for indoctrinating young students,” Prichard wrote.

A quick survey of websites of national religious right groups suggests that the Family Council is the first to speak out against those new LGBT health policies, which included better access to Medicaid for HIV-positive Americans, comprehensive sex education, governmental research into health disparities among LGBT people and an end to the taxing of same-sex partner benefits.

In a Twitter message, Jonah Goldberg wrote:

?? Dems want a health system that says when you can knee surgery, but demand abortion coverage because women should control their bodies.

While its moral logic confounds liberals at Instaputz and Wonkette, Goldberg’s tweet could supply a slogan for former U.S. Sen. Norm Coleman’s political comeback.

Coleman himself underwent knee surgery just last spring — at his own option and, in all likelihood, at government expense.

So the Coleman for Governor in 2010 campaign might be built around the specter of”government knee panels” or the Constitutional protections of “a man’s right to choose.”

Photo: WDCpix

While abortion politics dominated conservative opposition to the health care reform package that barely passed the U.S. House on Saturday evening, several measures in the bill that are beneficial to LGBT Americans largely went unnoticed — especially by conservatives.

The Human Rights Campaign reports it successfully lobbied to get five provisions important to the LGBT community included in the final bill.

Currently, the government doesn’t track health disparities based on sexual orientation and gender identity like it does for race, economic status, marital status, age and a number of other characteristics. The bill that passed the House would add those categories to the government’s data collection practices and would for the first time be able to determine health disparities. That would enable the government to direct funding for research and public health efforts to address those disparities. A similar bill has been offered in Congress, the Ending Health Disparities for LGBT Americans Act.

The House bill also contains language from the Tax Equity for Health Plan Beneficiaries Act. Employer-paid health benefits for a domestic partner are taxed by the federal government as income but benefits for spouses are not. That means same-sex couples that utilize their employers’ health plan pay income taxes that married couples do not. The bill that passed the House on Saturday would fix that inequity.

An important disparity in the treatment of HIV is remedied in the bill. In order for people living with HIV to qualify for Medicaid programs they must have a diagnosis of AIDS — which often comes after years of living with the disease. The new legislation would enable states to qualify individuals who are newly diagnosed with HIV disease for Medicaid programs. That policy is included in the bill as the Early Treatment for HIV Act.

Strong protections to prevent discrimination on the basis of sexual orientation and gender identity in health insurance and in the health care system also made it into the House bill.

Finally, the bill provides funding for comprehensive sex education programs that include relevant information for LGBT students.

Many of these policies have drawn fire from the religious right in the past, but recently such groups have been exerting most of their opposition to opposing abortion rights in the health reform bill. And the Stupak Amendment, which aims to ban any federal funding to cover abortion services, dominated the debate over the bill.

For instance, Peter LaBarbera of Americans for Truth, who railed against the tax equity bill in July, hasn’t mentioned its inclusion in the health bill.

The American Family Association opposed fixing health disparities for LGBT people as early as February, but abandoned that cause to fight against the inclusion of abortion rights in the health reform bill.

And the Family Research Council seems to have completely missed any notice of the LGBT provisions in the bill. The group spent a considerable amount of time and money on opposing abortion in the health reform bill, and FRC president Tony Perkins was even a featured speaker at Rep. Michele Bachmann’s “House Call” event opposing health care reform. He spoke about abortion.

Update: Now Minnesota Family Council is noticing LGBT measures in healthcare bill