Earlier this week in a speech, newly sworn-in Secretary of Health and Human Services Mike Leavitt addressed the issues surrounding Medicaid reform, remarking that the problem is “big enough to see and small enough to solve”. During the speech, Sec. Leavitt did make several policy statements by saying there would be no block grants, no cuts in available resources, and mandatory populations would not have their coverage changed.

The Secretary also mentioned three Medicaid reforms that could save the federal government money. First, allowing states to purchase pharmaceuticals for less than they presently do, second, closing down loopholes that allow people to become eligible for Medicaid by giving away assets to their children and third, proposing an “uncomfortable, but necessary conversation” with states about shutting down financing loopholes.

Finally, Secretary Leavitt mentioned three opportunities in Medicaid reform. The first, an emphasis on home and community based care (as opposed to institutional care). The second is expanding access to more children. While details have not been provided, the President recently announced a plan to conduct a $1 billion outreach campaign designed to bring eligible but unenrolled children onto Medicaid and the State Children’s Health Insurance Program (SCHIP). The third is the opportunity to restructure coverage of Medicaid’s currently optional populations. The Secretary proposed allowing states to use SCHIP levels of benefits to provide “quality basic health coverage” for optional populations.