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Failures and Fixes, Representative Joe Hubbard on Medicaid, Part two

By Bill Britt
Alabama Political Reporter

MONTGOMERY—”Asking people who create the cost to bear some of the cost just makes sense,” says Joe Hubbard (D-Montgomery).

Hubbard believes that state leaders have ignored market-solutions to supply needed revenue to the Medicaid system. He thinks that using basic free market ideas are some of the means to shoring up the troubled plan and bring fiscal sanity into the process.

“We have a governor who does not want to fund Medicaid through fiscally responsible approaches like user fees on cigarettes or co-pays,” Hubbard said. “Yet he wants to block the legislature from making sure the measures to fund Medicaid are fiscally responsible. There is no evidence, rhyme, or reason for this type of thinking.”

During the 2012 regular session Hubbard was a strong voice along with a few others who were preaching the gospel of asking “those who used the system to help fund the system.” He also put forward a bill that would have attached a user fee to cigarette purchases to help fund the Medicaid program.

“A pack of cigarettes is a very expensive item if a person can afford to spend money to buy cigarettes then they can afford to pay a co-pay on Medicaid,” Hubbard said.

He says that around 238 million dollars of the state’s Medicaid budget is devoted to fighting cigarette-related diseases each year.

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Hubbard believes that asking that cigarette smokers pay a user free on the product they consume is a reasonable approach to gaining needed revenues for Medicaid.

However, Governor Bentley and many republicans have steadfastly resisted Hubbard’s idea saying that a user fee is just another way of saying tax.

The governor and many members of the GOP have pledged a no-new-tax policy and therefore are unwilling to entertain a cigarette fee. “This is hypocritical on its face,” says Hubbard. “They raised fees on court costs to fund the court system.” Hubbard says that by their logic an extra cost to taxpayers to use the court system is not a tax but a fee but yet a fee to use cigarettes is not a fee but a tax doesn’t hold water.

Hubbard has also been a proponent of charging a co-pay for using Medicaid services.

A person with private insurance pays roughly between $20 and $40 in co-pays for every minor doctor visit,” notes Hubbard. “But Medicaid recipients pay nothing.”

Hubbard continues, “A small eight dollar co-pay does a couple of things. First it brings in some necessary revenue from people using the service and it also helps put some market forces on those services.”

Hubbard uses an analogy to further explain his thinking, “For example an owner of a carwash decides to advertise that he is giving a way free car washes, all of a sudden people are coming in twice as week to have their cars washed. But if I tell you I am going to charge you twenty-five bucks for that car wash then you are only going to come in when the car is dirty. It is the same thing with Medicaid. A co-pay raises revenue in a fiscally responsible way, much like a user fee on cigarettes.”

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Historically there has been a constant resistance in Alabama to such fixes as placing a co-pay or cigarette fees to offset the cost of Medicaid.

“The best I can tell is no one has had the political courage to deal with the Medicaid problem even using proven market methods,” Hubbard said.

Hubbard believes a simple Medicaid card could offer many benefits toward a fiscally sound and responsible based Medicaid system.

Almost daily there are those on talk radio and in newspaper editorials bemoaning Medicaid fraud. Hubbard says with all the talk nothing has been done to implement a simple and market proven method to curtail some fraud.

“Another idea that could save money in the Medicaid system is to make sure that those who are using Medicaid are using it properly,” Hubbard says, “Currently there are no checks in place to verify that an individual is not abusing the system in multiple ways. The whole purpose of the Medicaid card is to ensure that, for every patient, there is more than a name on the Medicaid rolls,” says Hubbard. “In the private insurance world, every patient has a benefit card that is linked to their name, their social security number, their medical history, etc. That card ensures that each patient gets exactly the treatment prescribed for his or her condition, no more, no less.”

Hubbard explains that in the private insurance world, these cards ensure that the patient that is supposed to be receiving treatment or medicine is actually the one receiving treatment or medication.

“For example, Patient A couldn’t just walk in to a pharmacy pretending to be Patient B and fill Patient A’s Rx for Lortab, then turn around and sell it,”says Hubbard. “The card would keep the Rx from being filled twice.”

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Another advantage that he points out is that with a benefit card, a patient would only get the treatment absolutely necessary. Hubbard explains, “If that patient requires treatment for his hemorrhoid and Doctor A gives him a hemorrhoid belt, rather than surgery, that patient could not shop his condition around to a different doctor to get the preferred treatment; there would be a record of treatment of that patient by Doctor A connected to the patient’s benefit card.” Hubbard says that a Medicaid benefit card would cut down on fraud and waste and insure patient care all while saving money.

“I believe there are many people who realize the importance of Medicaid but they also know we have to be smarter about Medicaid,” Hubbard said.

He thinks that a failure of leadership and the Governor’s stubborn commitment to political posturing at the expense of good and necessary policy is failing Medicaid and the people of Alabama.

In our next installment Hubbard talks more about smart budgeting for Medicaid and what he wishes the governor would do going forward.

Written By

Bill Britt is editor-in-chief at the Alabama Political Reporter and host of The Voice of Alabama Politics. You can email him at [email protected] or follow him on Twitter.

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