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Maryland health costs to rise

August 05, 2003

Maryland's health secretary says the $84.4 million in health-care budget cuts made by Gov. Robert Ehrlich will likely result in higher insurance rates, as citizens who are covered absorb more of the cost of caring for the uninsured. In addition to amounting to a stealthy tax increase, it also has the potential to harm the state's economic-development efforts.

Nelson Sabatini, the state's Secretary of Health and Mental Hygiene, said current cuts won't be the only financial pain suffered by Marylanders. As the state tries to keep up with increasing costs, it will cut some services it now pays for.

Is Sabatini as heartless as he sounds? No. He recently announced that he'd like to put together a health-care plan to cover 580,000 currently uninsured Maryland residents. But without new revenue, it's a non-starter.

In the meantime, Sabatini said, the state will cut the number of hospital days it pays for under the Medicaid program, forcing hospitals to provide more "uncompensated care." That cost is then passed to other patients, in the form of higher rates.

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The governor blames the legislature, saying that if it had passed his slot-machine initiative, that could have provided millions for health care. But slots were also supposed to provide millions for education, and with the governor and legislators at odds over how slots would work, the health-care issue is unlikely to be solved quickly.

Finding a way to stabilize health-care costs would be a boon for economic development, since every business needs accurate projections of its expenses. And businesses that don't have to hold cash in reserve for health-care costs might be more inclined to invest it in job-producing activities.

Rather than battling with lawmakers over who's at fault, the governor needs to meet with them and Sabatini to decide how to resolve this issue. If they don't work together, there will be plenty of blame for all to share.

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