A Texas-Size Settlement

It will cost Texas $500 million or more over the next two years, but a class-action lawsuit that has been hanging over its Medicaid program for 14 years has been settled. Under the agreement, Texas must fix the program--making sure regular check-ups are offered to children and providing Medicaid mothers with adequate information about guaranteed services. The settlement also calls for a 25 percent hike in reimbursements for doctors willing to accept Medicaid children as patients. A Texas Medical Association survey found that the percentage of doctors accepting new Medicaid patients had slipped from 67 percent in 2000 to only 38 percent in 2005. That falloff coincided with reductions in Medicaid reimbursements starting in 2003.

WISCONSIN TO REPLACE SENIOR CARE

Wisconsin has been the last holdout, offering its seniors a drug program as an alternative to Medicare Part D. SeniorCare currently serves 100,000 low-income seniors who pay no monthly premiums for drug coverage without Part D-style gaps. But Wisconsin was under pressure by the federal government to close it down because of what the feds saw as inefficiencies. Wisconsin claims that its popular program halved the amount that would normally be spent for a senior under Part D and that the program had already saved the federal government $669 million in Medicaid costs. The state now plans to replace the existing program with a new one--WisconsinCare--which it crafted with help from the feds.