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Bush's New Health Secretary Decries Medicaid Planning

  • February 2nd, 2005

In his first speech as secretary of the Department of Health and Human Services, Michael O. Leavitt called for sweeping changes in Medicaid, including making it more difficult for the elderly to qualify for Medicaid coverage of long-term care by transferring assets to their children.

"Medicaid must not become an inheritance protection plan," Mr. Leavitt told a convention of health care executives meeting in Washington, D.C. "Right now, many older Americans take advantage of Medicaid loopholes to become eligible for Medicaid by giving away assets to their children. There is a whole industry that actually helps people shift costs to the taxpayer."

Federal and state spending on Medicaid now totals more than $300 billion a year. Leavitt said that restricting the ability of elderly people to transfer assets could save $4.5 billion over the next decade. This savings would amount to a little more than one tenth of one percent of current Medicaid outlays.

Leavitt made his remarks at the World Health Care Congress, a convention of 1,500 "healthcare industry leaders" co-sponsored by The Wall Street Journal and CNBC. (The Wall Street Journal subsequently published an editorial calling for restrictions on Medicaid planning. For more on this, click here.) Other major sponsors of the Congress were consulting firms Capgemini and Booz Allen Hamilton, and UnitedHealth Foundation, a foundation formed by UnitedHealth Group, the parent of the managed care company UnitedHealthcare.

To read Secretary Leavitt's speech, go to: www.hhs.gov/news/speech/2005/050201.html

To read an account of his speech in The New York Times, go to: www.nytimes.com/2005/02/02/national/02health.html?oref=login (Free registration required and article may no longer be available free of charge.)

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Last Modified: 02/02/2005

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