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Date: September 20, 1995
For Release: Immediately
Contact: HHS Press Office, (202) 690-6343
Advisory: Impact of GOP Medicaid Cuts on Each State
The Department of Health and Human Services has prepared a
state-by-state analysis of the impact of the $182 billion in
Medicaid cuts proposed yesterday by House Republicans. That
legislation is scheduled for consideration today by the House
Commerce Committee.
The HHS analysis compares the projected baseline Medicaid
budgets of each state with the amount provided for each state under
the GOP proposal. It shows the net impact of those reductions
during the 1996-2002 period as well as the impact in 2002 alone.
Overall, the Republican plan translates into a 19 percent reduction
in federal Medicaid spending. Individual state losses range from a
high of 32 percent in Indiana and West Virginia to a low of 8
percent in Alabama and Pennsylvania.
A summary of the analysis follows.
[For copies of the charts showing state-by-state
impact, please call HHS Press Office, (202) 690-6343.]
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State-by-State Impact
of House Republican Medicaid Cuts
The House Republican Medicaid plan is designed to cut federal
Medicaid spending by $182 billion below the Congressional Budget
Office's projected Medicaid spending over the next seven years. The
state-by-state allocation of federal spending -- and the cut below
the baseline -- is based on an extraordinarily complex formula in
the bill.
To assess the impact on states, it is necessary to compare two
estimates: estimated federal Medicaid spending under the current
law baseline, and estimated spending under the proposed plan.
Pending further review and assessment of the just-released formula,
this impact analysis is based on two publicly-released projections:
- Baseline spending estimate: the Urban Institute's projection
of baseline Medicaid spending state-by-state was published in
May and has been in public use since then.
- Spending under the plan: the General Accounting Office
estimated the allocation of federal funds to states under the
House Republican formula on September 19, 1995.
The difference between the two provides a preliminary estimate of
the state impact. It shows:
- The plan achieves the target of $182 billion in cuts in
federal spending over seven years -- 19 percent below the
seven-year baseline, and 30 percent below projected
spending in 2002.
- The range of state impact is extraordinary:
- By the year 2002, one state -- New Hampshire -- has no
cut. All the rest of the states are cut below their
baseline estimate.
- Five other states, however, suffer cuts of more than 40
percent below their 2002 baseline: Alaska (-41 percent);
Indiana (-44 percent); Rhode Island (-42 percent);
Washington (-43 percent); West Virginia (-42 percent).
- Financially, the greatest dollar impact is in the largest
states -- New York and California.
- New York is cut by $24.6 billion below its seven-year
baseline estimate -- and 35 percent below its baseline
estimate for the year 2002.
- California is cut by $18.7 billion below its seven-year
baseline estimate -- and 27 percent below its baseline
estimate for the year 2002.
- One-half of the total cut of $182 billion comes from eight
states: California, Florida, Indiana, New Jersey, New
York, Ohio, North Carolina, and Texas.
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