States than in the past. Data also show that individuals cared for in the publicly financed HIV delivery system often receive inadequate or incomplete care because of variations in coverage and limitations on prescription drugs and other services. Simply stated, the nation’s current approach, which provides limited federal funding for early treatment of HIV and relies on the federal–state Medicaid partnership to fund much of the care once an AIDS diagnosis is made, does not provide the fiscal or administrative resources necessary to finance timely, comprehensive, and consistent care to low-income individuals infected with HIV.

The Committee examined seven different alternatives to the existing public financing arrangements. These ranged from incremental approaches building upon the existing Ryan White CARE Act, Medicare, and Medicaid programs, to the establishment of new federal programs. As explained in Chapter 5, the Committee concluded that the approach that best fit the criteria for effective public financing of HIV care for low-income Americans was a federally funded, state-administered program (Option 7). Medicare’s character as a social insurance program oriented toward acute care was felt by the Committee to be incompatible with the need for a program targeted at the chronic care needs of low-income individuals with HIV. While Medicaid, as the nation’s largest health care program for the poor, would appear to be a logical program on which to build, the Committee concluded that options for expanding Medicaid would not provide adequate funding under current and foreseeable state budget constraints. Similarly, options that leave the states substantial discretion to limit eligibility, benefits, and provider payment levels in order to constrain costs would undermine the Committee’s objectives of a national program addressed to a national epidemic.

Under the Committee’s recommendation, state participation would be voluntary. The federal government would pay the costs of covering low-income individuals with HIV, as well as all costs incurred by participating states in connection with administration of the program. To eliminate any uncertainty on the part of states regarding the availability of federal funds, the Committee recommends that the program be funded as an open-ended entitlement to states and not be subject to annual appropriations. That is, the federal government would pay all allowable costs of providing covered services to eligible individuals through qualified providers. Because the federal government would guarantee the payment of the costs of treating low-income individuals with HIV that states and localities now incur under Medicaid or the Ryan White CARE program, as well as the new costs they could be exposed to as the epidemic proceeds, the Committee believes that all states would choose to participate.

As a condition of participation, the new program could apply minimum standards relating to eligibility, benefits, and provider payment so as

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