The state will continue to pay for medical equipment, including oxygen tanks, apnea air compressors, crutches and wheelchairs for about 100,000 Medicaid recipients whose benefits were set to end on July 1.
The state announced in July that it would not cover durable medical supplies and equipment as part of a plan to reduce Medicaid expenditures over two years to balance the budget. Medicaid is the government medical insurance program for low-income residents.
The state sought to trim benefits and eligibility as enrollment grew by 34 percent since 2008 as the economy struggled and unemployment rose. The $150 million reduction in costs represents 9 percent of the total Medicaid budget.
Last year QUEST, the state’s Medicaid program, covered more than 272,000 people in Hawaii, or nearly 1 in 5 residents. The cost of the QUEST program has grown to $1.7 billion a year. The state gets about half of its Medicaid budget, or $870 million, from the federal government.
The state Department of Human Services, which administers Medicaid, determined last week after the Legislature finalized the budget that it could maintain coverage of medical supplies, deemed the first priority after hearing public concerns. Funds to continue coverage were realized through reductions in eligibility for QUEST, reduced reimbursement rates for providers and an increase in federal matching funds, among other streamlining efforts.
"After further discussion and a deeper look into our fiscal situation, it was clear that we could meet the priority of restoring durable medical equipment," said Pat McManaman, DHS director, in a statement. "The governor made it a priority and in this case, the department understood there was an obligation for those in need of these services. We are very pleased with this outcome."
DHS is reviewing use trends and seeking additional funds to maintain other benefits scheduled to be cut, including rehabilitation services and optometry, according to Kenny Fink, Med-QUEST administrator.
"In this case, the issue was to assist individuals who needed medical supplies and coverage," said Donalyn Dela Cruz, spokeswoman for Gov. Neil Abercrombie, in an email. "The governor’s mandate for continued fiscal prudence in this administration has allowed for ways to make sure that the most needy can be assisted."
The state is still planning to cut Medicaid benefits and eligibility to contain costs. Most of the savings will come by reducing the number of adults enrolled in QUEST by roughly 3,500. The cuts will not affect children, pregnant women and the aged, blind and disabled.
In addition, the state will limit the number of inpatient hospital days QUEST patients are allowed for medical and surgical services and for behavioral health, which are now unlimited. Outpatient rehabilitation and optometry services also are slated to be discontinued. Fink hopes some of the proposed service cuts can be avoided before the new QUEST health plan takes effect July 1.
