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Both House and Senate Recommend Cutting MiChoice Funding

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Issue 28, Summer 2005

Both House and Senate Recommend Cutting MiChoice Funding
by Alison Hirschel, MPLP Elder Law Attorney

Both the Michigan House and Senate have recommended further cuts in funding to the MiChoice Home and Community Based Waiver Program for FY '06. These cuts are aimed at reducing administrative costs, a controversial issue in the waiver program. Waiver agents point out that care management and assessment services provided by nurses and social workers are misleadingly designated as administrative expenses, thus inflating those costs. They insist that these "administrative costs" are essential services for clients.

Even without the proposed funding cuts, and despite the settlement of the Eager lawsuit, MiChoice funding is 33% lower than it was in 2001. Moreover, at the current level of funding, even without further reductions, enrollment in the program continues to decline. By FY 2007, the Department of Community Health estimates that enrollment will be approximately half of what it was in 2001. At the same time, waiting lists around the state continue to increase and some estimate there are approximately 2,000 people statewide seeking admission to the program.

The proposed cuts to the MiChoice program are contrary to the unanimous recommendations of the Governor's Medicaid Long Term Care Task Force. Both the Bush Administration and the Granholm Administration support expanding home and community based services. And studies across the country have shown that programs like MiChoice are cost-effective and responsive to consumers' preferences. Thus, the legislature's proposed reductions to MiChoice have already generated real concern and significant protest.