Medicaid debate begins in Lansing


State senators overseeing Michigan's Medicaid budget have begun taking testimony on the future of the program. Some lawmakers say the Medicaid debate may be one of the toughest state budget battles this year.

Governor Granholm has proposed a tax on physicians to cover the growing costs of the Medicaid program. Officials from the Department of Community Health told lawmakers that without the tax in place to keep pace with the market, Medicaid rate cuts would trigger a quote "death spiral" - where fewer doctors take Medicaid patients, health provider premiums rise, fewer employers provide health benefits, and more people then sign up for Medicaid.

Steve Fitton is the director of the state's Medicaid program.

"We can't emphasize enough how devastating further rate cuts would be to the program in fulfilling its basic mission," he says.

Although some in the medical community support a new physicians' tax to cover Medicaid, enough people have stood against the tax to have prevented it from moving through the Legislature in recent years.