Nevada Governor’s Threat Should Be Wake-up Call

We’ve seen this happen before. Unlike the Federal government, states must balance their budgets every year. The economy tanks, state budgets shrink and as governors crunch the numbers they can’t help but consider axing the biggest ticket item: Medicaid.

Nevada Governor Jim Gibbons has done just that, according to a report from the Las Vegas Review-Journal.

A conservative Las Vegas-based think tank said the idea could save the state money and suggested that poor Nevadans probably would be better off without Medicaid, according to the article. But legislative leaders said Gibbons’ idea would not receive their approval, which might be required. And a nonpartisan policy research group that monitors Congress said dumping Medicaid would leave many Nevadans without health care.

I’d be willing to bet it won’t happen after the governor’s staff researches the implications of such action. It’s a pretty difficult move to justify. If he follows through, Nevada would become the first state to have dropped Medicaid during tight times.

This should, however, be a wakeup call for Congress as to the magnitude of the problems facing states when it comes to health care and Medicaid costs. Despite at least a 50 percent match in federal funds, coming up with the remaining tab is getting more and more difficult in this economy.  The cost of health care to states continues to grow and to infringe on other priorities – in some states health care consumes almost 30% of the state budget.

In the coming months, Congress must consider extending the enhanced match for Medicaid until the country climbs out of economic crisis. Otherwise, the results could be devastating, perhaps particularly so for 233,000 Nevadans who currently receive Medicaid benefits.

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