With billions of dollars in Medicaid spending at risk in Congress

(Reuters) The "red" and "blue" states that mark America's political divide between conservative and liberal sympathies are often far apart on issues involving healthcare, including Medicaid, the $420 billion-a-year program for the poor.

But lobbyists say governors, legislators and other state officials, Republican and Democrat alike, have found common ground in a push to convince a special congressional deficit panel that White House-backed Medicaid cuts totaling $41 billion will only weaken a system that already struggles to deliver care to 60 million beneficiaries.

The 12-member bipartisan panel, dubbed the "super committee" because of its powers, is tasked with finding $1.2 trillion in savings to cut huge U.S. deficits. The full Congress is due to vote on their recommendations by late December.

State officials appear most unified on an alternative cost-cutting strategy, which they say could save more than $100 billion by changing the healthcare delivery system for the poorest, sickest and most costly patients. Known as "dual-eligibles," they qualify for both Medicaid and Medicare, the government-run program for the elderly.

There are about 9 million dual-eligibles and state officials see billions of dollars in savings from shifting them into managed care plans better able to eliminate unnecessary doctor's visits, tests and hospital admissions.

"Support for that proposition is very broad," Maryland Governor Martin O'Malley, who chairs the Democratic Governors Association, told Reuters.

States also hope the super committee will adopt proposals to control Medicaid prescription drug costs, combat waste and fraud, and relax federal restrictions on benefits and eligibility, lobbyists said. http://www.reuters.com/article/2011/09/29/us-usa-debt-states-medicaid-idUSTRE78S0PK20110929