July 05, 2005
Perry v Bush: The Clawback

The new Medicare drug benefit that goes into effect in January will cover "dual eligibles", which are people on both Medicare and Medicaid. This group is generally in worse health and is costlier than either people on Medicaid only or those on Medicare only. At first, this news was greeted cautiously but potentially optimistically by the states, most of which currently provide drug coverage to these individuals through their Medicaid programs.

But then, the details came out (they always do, don't they?). The states realized that they were going to be completely rooked by the "clawback" provision, which basically says states have to send money they heretofore have spent on dual eligible drug coverage back to the feds, to defray costs of the Medicare drug benefit. The new Medicare law also places some administrative requirements on states that they estimate will, along with the clawback, more than offset any savings they will see from the feds taking over dual eligible drug coverage.

Well, the states aren't gonna sit still for this. And damned if Texas' own Rick Perry isn't leading the charge. In fact, Perry vetoed a provision that would have provided money for Texas' share of the clawback over the upcoming biennium.

Scott McClellan has said Bush isn't going to get involved in the Republican primary for Texas governor as he considers both Perry and Strayhorn friends. It will be interesting to see whether Bush uses his political support as a way to force Perry to cough up the money -- or if he uses the clawback issue as cover to help Strayhorn in the primary.

Posted by Hope Morrison on July 05, 2005 to National news | TrackBack