Assignment 2: Budgetary Analysis In Healthcare

Budgetary Analysis
HCS 550
March 2, 2015
John Dean
Budgetary Analysis
The United States administers a healthcare program that is nationwide to qualifying individuals who are either disabled or have a low-income. This program is one of the largest contributors for providing health care services for poverty-stricken Americans. It is collectively receives its funding from state governments as well as the federal government. The major responsible party for funding is the state government (“Overview of the Medicaid”, 1995). When the government undergoes an economic crisis, this places a strain on the current budget in place. This causes an increase in Medicaid eligibility resulting in states making necessary budget cuts as they see fit.
However, the Constitution did not depict any standards as far as how this power is to be exercised and it did not detail requirements for the budget process. Congress has derived it’s very own set of rules that is continuously altered/updated (Heniff, Lynch, & Tollestrup, 2012). The bill dictates how agencies and programs will obtain funds annually. Legislation has to be passed by Congress. This gives Congress the ability to disperse money to these agencies as well as programs. Social Security, Medicare and Medicaid benefits are considered to be mandatory expenses. This is because the law indicates that the government will need to pay benefits to all people (Heniff, Lynch, & Tollestrup, 2012). Each state follows a budget process that is very similar to the Federal process. According to Heniff, Lynch, & Tollestrup (2012), there is a five step process involved for creating a federal budget. These steps are as follows:
Step 1: Budget proposal submitted by the President
In February of each year, the President sends over a request for budget to Congress for the next year. The budget proposal is just a simple request. However, Congress needs to review the bill and accept it. When the President signs the bill or bills, then a budget for the next year is created
Step 2: Budget Resolution is passed by
Hospitals and provider facilities will be impacted as well as they will no longer be able to provide the same services that they use to. This due to the fact that providers and hospitals currently receive Medicaid reimbursements that are approximately 100% less that cost of care provided (Dickson, 2014). Providers will begin to avoid performing services that are not profitable. The creation of job opportunities and boosting the economy is generated through the Medicaid program. So, when the enrollment for Medicaid rises, it becomes the responsibility of the state to find the means to gather the necessary funds to accommodate the increase. Typically, states proceed with cutting back funding for other services included in the budget such community services, education services, and emergency services. (Dickson,