Posted by: arnegrim | April 21, 2010

Bankrupting states…

As if states weren’t in bad enough fiscal shape as it is…

“The new health care law could shift billions of dollars from cash-strapped states to the federal government by changing the way Medicaid prescription drug rebates are treated, according to state and industry officials and an examination of Medicaid spending data.

Democrats included a provision in the health law designed to raise $38 billion over 10 years by requiring greater discounts from drugmakers selling to Medicaid, the joint federal-state health insurance program for the poor. Previously, the rebates were divided between the states and the federal government. Under the law, a significant portion of the rebates will go solely to Washington beginning this year…

…California, for instance, stands to lose $50 million next year alone because of the changes, according to Toby Douglas, the state’s deputy Medicaid director…

…Anne Murphy, Indiana’s secretary of the Family and Social Services Administration, circulated a memo predicting losses of $400 million over 10 years because the federal government plans to “confiscate” a portion of its rebates…”


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