Babauta urges cap on number of Medicaid beneficiaries

Commonwealth Healthcare Corp. chief executive officer Juan N. Babauta is urging the Legislature to conduct an oversight hearing on the Medicaid program, which continuous to certify eligible recipients even without having enough funding to provide for their services.

The Medicaid program was first implemented in 1979. It is a federal/state program administered by states and funded by both federal and states revenues through a 50-50 matching ratio. Each year, the federal cap is set at $5 million and requires an equal amount from the CNMI government. Any expenses in excess of the $10-million level is shouldered by the state.

Babauta disclosed in an interview yesterday that the program currently has 18,000 eligible recipients, compared to the 3,000 clients recorded in 1994. Without a policy that caps the total number of people that will be certified every year, the local government has been shouldering millions of dollars on top of the $5 million local matching it provides for the program.

“What we really need to work on is the removal of the cap and maybe changing the current ratio [of 50-50 matching] because we cannot afford it anymore,” Babauta said.

Babauta has already asked for Delegate Gregorio Kilili C. Sablan’s (Ind-MP) help in asking the federal government with this. He said it would greatly aid the CNMI if the reimbursement rate is changed to a 72-25 ratio, similar to what other states like Mississippi enjoys.

At present, the CNMI government owes some $800,000 in reimbursement for patients’ services. Babauta said he is not so worried about this unpaid amount as the future of the program in general.

“The Medicaid office continues to certify people as eligible so our numbers are increasing but with the same cap [of $5 million]. So we are certifying more and more people with inability to pay for services and that’s my problem. This is all about who pays for the services and if we don’t have the money for it, we really should not be certifying any more people. We don’t want to mislead people, but that’s what happening now. We certify people, knowing.we cannot afford to pay for their services,” said Babauta.

The CNMI government, through the Legislature, can help if a measure is crafted that will limit the number of people that will be certified under the program each year.

“I understand that if they qualify they need to be certified.but we have to be realistic on how much we can afford. I am urging the Legislature to hold open hearings for parties so everybody knows where we are because this situation worsens our financial problems than help. I believe this is really about policy,” he said.

According to Babauta, the 50-50 matching fund requirement was temporarily reduced to 55-45 sharing because of the funds from the American Recovery Reinvestment Act. However, the original sharing ratio will be back next year.