New Jersey’s Proposals to Cut Health Care Spending

Last Updated: 06 Jul 2020
Essay type: Proposal
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In virtually every corner of the United States, State governments are grappling with the inevitable challenge of deriving a balanced budget given the outstanding deficits in revenues, a scenario largely precipitated by the financial crisis that has hit the nation. New Jersey is no exception. Indeed, state officials have increasingly found themselves faced with the reality of soliciting sufficient revenues to fund the topmost priority issues, unlike in previous budget allocations. In an attempt to draw a balanced and fair budget for the 2010 fiscal year, various proposals have been advanced.

One of the efforts that can not escape notice is the idea of cutting funding for the state’ FamilyCare. The proposed strategy in realizing such an objective involves freezing the enrollment of parents between 150 and 200 percent of the federal poverty level and the implementation of co-payments for individuals in Medicaid and the AIDS Drug Distribution Program (ADDP) (NJ for Health Care, 2009). Indeed, the budget dilemma facing the state is understandable, given the severe economic conditions.

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Whereas the idea of cutting monetary allocations on some items would suffice in minimizing the critical budget deficits that are essential in facilitating the advancement of the state’s yearly programs, adopting a rational approach based on critical evaluation reveals the utter need to reconsider the said proposals. In an economy where a significant majority is struggling to meet the high costs of living, the proposal to cut back FamilyCare enrollment of parents is evidently a grave issue that can be described as a matter of life and death.

The fact that a healthy population is vital in the enhancement of economic prosperity is an indisputable reality that the state authorities embrace. In essence, the provision of Medicaid prescription drug benefits as well as the upgrading of Drug Distribution Programs for AIDS patients is essential in promoting health and wellness among New Jersey residents. Amidst the tough economic times, the advocacy of a sound healthcare policy is of critical significance. As such, the proposal to cut back funding on health-related programs like FamilyCare, Medicaid and ADDP should be inevitably reconsidered.

The Significance of the Proposed Changes on Health Care The availability of quality and affordable health care services is necessary in the advancement of individual well-being. From a medical perspective, the client (patient) is the most important person. A general look at the proposed cuts and co-pays gives the indication that they will affect the ability of individuals to meet health care costs at a time when the cost of living has reached significantly high levels.

In reality, the proposals will have a significant impact on health-seeking behavior, which constitutes a direct concern for the nursing and medical professions. The Impact of the Proposals from Positive and Negative Perspectives Generally speaking, the idea of coming up with a single healthcare policy that is not only budget-friendly, but which adequately addresses the health needs of the American population has remained elusive.

At the national as well state level, financial analysts have year in year out grappled with the task of allocating funds to diverse priority issues. The idea of substituting certain financial allocations with others discerned to be of more socioeconomic consequence, often with mixed repercussions, has emerged as one of the most popular trends. Indeed, years of research and analysis has depicted the initiative of cutting health care spending on specific items as a double-edged sword. Positive Consequences

One of the healthcare policy issues that have been extensively studied is the effect of Medicaid drug co-payments. Examining the results reveals a significant degree of consistency in as far as the programs’ ability to minimize the overall healthcare expenditure is concerned. A longitudinal survey carried out in thirty eight states revealed that co-payments play an important role in barring individuals entitled to Medicaid benefits from filling prescriptions during a particular year, holding all other factors constant (Mason, Leavitt, and Chaffee, 2007).

The predominant argument advanced in support of such behavioral trends is that beneficiaries of government-sponsored healthcare programs are inherently motivated to excessively utilize healthcare services funded by the government, which include ADDP and Medicaid, when compared with those with private insurance (National Organization for Women, 2007). By extension therefore, implementing co-pays suffice in instilling an increased sense of responsibility on beneficiaries of such programs, thus minimizing the tendency to seek unnecessary medical care.

In essence, the rationale behind the suggestion to implement co-pays is based on their underlying assumption that the move would discourage unnecessary consumption of the Medicaid and ADDP programs which have traditionally been sponsored by the New Jersey government. In the long-run, the move is expected to save the state from excessive expenditures, and the arising funds directed to other priority issues. Negative Consequences A closer evaluation depicts the proposed healthcare cutbacks as likely to precipitate numerous unintended consequences in the long-term.

For instance, it would expose the residents of New Jersey to increased health risks and dangers. This is particularly so considering the vulnerable population groups such as the poorest of the poor, the physically and mentally challenged, and those suffering from terminal illnesses. According to preliminary projections, the Medicaid proposal will affect an estimated 418,000 of the most vulnerable individuals, while the ADDP one will affect about 7,500 individuals registered under the program (NJ for Health Care, 2009).

Indeed, New Jersey’s FamilyCare program acts as the principal health insurance plan for low-income families within the state (Castro, 2007). Thus, the decision to close the insurance programs and implement co-payments will have far-reaching consequences on health-seeking behavior amongst these vulnerable groups. The most obvious result would be to deter patients from seeking healthcare at the appropriate times. This would serve to exacerbate their health conditions, and majority would definitely end up requiring specialized hospitalization and emergency attendance.

For instance, baring individuals with HIV/AIDS from accessing the AIDS Drug Distribution Program and imposing co-pays implies that a significant majority from low-income households could fail to access the life sustaining drugs as well as the related services necessary for positive living. While the assumption that depicts co-pays as serving to reduce unnecessary expenditures for individuals entitled to state-sponsored medical programs like Medicaid and ADDP could hold under certain circumstances, there is also a strong counterargument that the opposite could be true.

Denial of the existing health insurance program (FamilyCare) which is fairly affordable would precipitate avoidable scenarios such as healthcare emergencies as well as serious illnesses (National Organization for Women, 2007). On another front, raising co-payments encourages patients to avoid cost-effective healthcare, and instead, seek medical attendance when their health status has significantly deteriorated. Examining the previous results of implementing co-pays gives provides strong indications that they indeed cause disadvantaged and marginalized groups to forego healthcare services, even those often described as fundamentally essential.

In the last financial year for instance, the state of Oregon eliminated co-pays for prescription drugs after it emerged that the state’s Medicaid program co-payments were precipitating significant shifts in treatment patterns (Mason, Leavitt, and Chaffee, 2007). According to an investigation carried out in the same year, Medicaid co-pays for low-income individuals not only failed to reduce health costs as envisioned in the initial plan, but also precipitated clients to prefer a waiver of the co-pay as opposed to seeking medical services. The overall result of such tendencies is to inevitably increase the associated healthcare bills.

Thus by implementing the FamilyCare, Medicaid and AIDS Drugs Distribution programs, the state of New Jersey would end up incurring more costs. From a practical point of view, this increased burden would be transferred to the ordinary taxpayer who has to pay additional taxes so as to cater for the unplanned healthcare expenditures. According to an analytical survey conducted by the Hipic Directors Association of New Jersey (HDANJ), the proposed cuts are indeed shortsighted, and will most likely have severe financial implications (NJ for Health Care, 2009).

This is not only in reference to the direct costs incurred in curative care, but as well those initiatives deemed to alleviate disease causation and spread. A case in point is when we consider the possible costs of patients who contract infectious diseases like the HIV virus, simply because they lack concise awareness of how the infection is transmitted. Similarly, it would be necessary to embrace a relatively new approach in the institutionalization of mentally sick clients who fail to receive appropriate outpatient counseling (Castro, 2007).

In practice, these and other cases would most likely make the state and county governments incur additional and unplanned healthcare costs. Why the Nursing Professional Body Should Oppose the Proposed Cuts and Co-pays Examining the available body of evidence provides sufficient proof that the proposals to freeze the enrollment of parents in FamilyCare and implementation co-payments for individuals in Medicaid and the AIDS Drug Distribution Program are not only unnecessary, but also poses unprecedented health risks and dangers to the residents of New Jersey.

It is imperative that nursing professional organizations throughout the state join hands with the rest of the citizenry in ensuring that these proposals are not implemented, considering the pivotal nature of the nursing profession in advocating for sound healthcare policy and promoting individual wellbeing in society. Indeed, the nursing fraternity should fight these cuts by using whichever means possible to influence state authorities to safeguard the health for all residents through the restoration of funding for the State’s FamilyCare, Medicaid and AIDS Drug Distribution Programs.

This could be achieved by heeding the recently derived initiative of making phone calls to the state headquarters so as to express dissatisfaction with the proposals. Rationale for the Decision The proposals to cut health care spending on programs like Medicaid and ADDP in the state should not have been advanced at such an inappropriate timing. Indeed, the current financial crisis facing the nation as a whole has not spared New Jersey. Examining the unemployment rates reveals that they have attained record-high proportions.

As more and more citizens are laid off thus losing individual and family healthcare insurance, the situation is becoming more and more desperate for many residents, particularly for low-income households. At a time when living costs have attained unprecedented levels, the move to cutback enrollment in the State’s FamilyCare for poor working adults as well as the initiative to implement co-payments for individuals who least can afford them could not be less untimely and misplaced.

To further highlight why the proposed cuts and co-pays are unwarranted, it is worthwhile mentioning that New Jersey has indeed received unanticipated federal funding aimed at stimulating the state’s economic growth. Recently, for instance, the state received a windfall of an estimated two billion dollars (for Medicaid) and another one hundred million dollars (for FamilyCare) in additional federal funding, both of which were unexpected (). Despite the fact that these funds were largely utilized to correct the deficits in the state budget, it would have been similarly important to use a certain percentage cushion the health cutbacks.

Indeed, this was the actual intention of the Congress. By utilizing the additional funds in appropriate ways, New Jersey would have probably won itself even more federal funding to meet its priority issues. In a nutshell therefore, implementing the said proposals is certainly a misplaced option, considering that it would have been avoided had the sound allocation mechanisms been employed. According to recent projections, an estimated seventy thousand people would be removed from the FamilyCare program, the only major health insurance scheme for low-income households should the stated proposals go through (NJ for Health Care, 2009).

Likewise, the proposed move to implement Medicaid co-payments will affect the majority of those it is intended for: the elderly, poor, and children. The increased premiums and co-pays for health care have the implication that these vulnerable groups will be unable to access and afford essential medical services. Indeed, thousands of children in New Jersey could end up losing coverage for essential health care services such as payments for hearing aids, eyeglasses, and speech therapy among other necessary therapies hardly affordable to low-income households.

In addition, implementation of co-pays for patients registered in the ADDP means that the less disadvantaged may experience unprecedented challenges in accessing drugs, counseling services, and any other necessary therapies and therapies. Overall, the implementation of the proposed cuts and co-pays make it hard for New Jersey residents to access quality and affordable health care which has often been cited as a necessary prerequisite for economic growth and development. As evidence from the Oregon case where similar cutbacks were implemented, the overall state expenditure on healthcare is likely to increase, rather than decrease.

Though proposal to implement FamilyCare cuts and Medicaid programs co-payments may lead to reduced costs in the short-term, the unintended consequences such as the tendency by patients to seek medical services when their health condition has deteriorated will mean additional in the long-term. Rather than the envisaged intention of lowering costs, the implementation of the proposals will only serve to place extra pressure on the state coffers, which in turn will be redirected to ordinary taxpayers.

As New Jersey’s Senator Joseph Vitale recently observed, not only will vulnerable families be affected, but the state economy will also be hurt (NJ for Health Care, 2009). According to state projections, investing a single dollar in FamilyCare generates about four dollars in business activity, which translates to a loss estimated at forty million dollars (The Star-Ledger Editorial Board, 2009). Evidently therefore, the implementation of the proposed cuts and co-pays will have vast, disastrous and multiple consequences on individual families and the state as a whole.

Those arguing for the implementation of Medicaid and ADDP co-payments also seem to neglect the essentiality of good health. By making healthcare services less affordable particularly for low-income families, the proposed co-pays will push individuals to the edge where they will continuously face one inevitable dilemma: that of choosing between basic necessities like food and housing on the one hand, and heath care needs on the other. The overall result would be to discourage health-seeking behavior.

By implication, the nursing and medical professional fraternities will be faced with the increased task of attending to patients in critical conditions, which puts unwarranted burdens on an already strained health care system. Conclusion Considering the tough economic conditions that prevail in the state of New Jersey, it is imperative that the proposals to implement cuts for FamilyCare and co-pays for Medicaid and ADDP programs be reconsidered.

Particularly for individual families earning low incomes, the implementation of such initiatives presents a situation where one is increasingly faced with the dilemma of choosing between heath care needs and other necessities of life. Considering that the harsh economic conditions may force the State’s residents to opt to satisfy the more pressing needs of food and rent at the expense of health care services, it is necessary to reexamine the proposals.

In a nutshell, the New Jersey State authorities should focus on expanding health care insurance coverage for all residents irrespective of their socioeconomic status or race, rather than suggesting cuts and co-pays which will not only harm individual families, but the wellbeing of the state as a whole. References Castro, R. J. (2007). Time to Keep the FamilyCare Promise. New Jersey Policy Perspective. http://njcitizenaction. org/hcfallingshort. pdf Coalition for a Moral Budget. (2009). Press release: Medicaid and ADDP co-pays will harm the most vulnerable New Jerseyans call upon legislature to eliminate co-pays from budget.

Mason, D. J. , Leavitt, J. K. , and Chaffee, M. W. (2007). Policy & politics in nursing and health care. (5th ed). Edinburgh : Elsevier Mosby. National Organization for Women. (2007). Tax cuts hurt the poor. Opposing Viewpoints: Poverty. Ed. Viqi Wagner. Detroit: Greenhaven Press, 2007. Opposing Viewpoints Resource Center. Gale. Apollo Library. Retrieved June 25, 2009 from http://find. galegroup. com/ovrc/infomark. do? &contentSet=GSRC&type=retrieve&tabID=T010&prodId=OVRC&docId=EJ3010159287&source=gale&srcprod=OVRC&userGroupName=apollo&version=1.

0 NJ for Health Care (2009). Senator Vitale, Chair NJ Senate Health Committee stands with advocates to oppose cut backs to NJ FamilyCare, Medicaid and the Aids Drug Distribution Program. May 12, 2009. Retrieved June 25, 2009 from http://njcitizenaction. org/hcpress20090512a. html The Star-Ledger Editorial Board. (May 26, 2009). N. J. FamilyCare funding: An avoidable budget cut. The Star-Ledger. Retrieved June 25, 2009 from http://blog. nj. com/njv_editorial_page/2009/05/nj_familycare_funding_an_avoid. html

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New Jersey’s Proposals to Cut Health Care Spending. (2016, Aug 15). Retrieved from

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