Medicaid Cuts

So I just read an article about an 8% cut in Medicaid payments to physicians in Michigan (http://www.nytimes.com/2010/03/16/health/policy/16medicaid.html?pagewanted=1&ref=health) This has resulted in the physicians having to turn away Medicaid patients. This sounds on the surface like a terrible thing for the docs to do. But as of 2008 Medicaid was already is paying only 72% of the rates Medicare was paying to doctors. And at those rates, the doctors can no longer pay their rent, staff, malpractice insurance ( $42,800 for an obstetrician in Michigan -- paid before she can even open the door) and supplies. In other words, it is costing the doctors and the hospitals money to treat these patients.

Now, I understand that Medicaid is heavily subsidized by the Federal government (translation: you and I as taxpayers), but the states can use that money wherever they choose. It doesn't have to be used only for the intended purpose. I know my state has only just payed the Hospitals the bills it owes them for 2005-2007.

So how can the Congress think it can run a National plan? Or even understand how to administer this? And all the while, we are losing. Who will take care of us after the doctors are forced to go out of business? Remember, I am not talking about a physician pulling down a CEO style salary. Our primary care doctors make very modest incomes, but the cost of a Medical education  is close to $500,000 by the time a young doctor can start practice.

This system is indeed broken, but the Congress does not seem to me to be the correct entity to come up with a solution.