Medicaid Funding Relationship with Nonprofit Organizations

Medicaid keep Relationship with Nonprofit OrganizationsIntroduction/ background Allard and Smith (2014) define leg solelyy incorpo countd, evaluate-exempt entities that provide specific serve to be noncommercial complaisant service organizations. They arouse help low-income families that mogul not qualify for federal official assistance. Nonprofit organizations (NPOs) can range vastly in their size, scope, and form, but they are all reliant on donations and open funds to support their operations. This public documentation is supported by grants, contracts, and tax credits (Smith et al. 2012).The way in which Medicaid works can be some complex. From the agency standpoint, Medicaid has set values for services its clients qualification use. Documentation of the literal cost of a service provided is not needed, as clients need besides to prove the service was provided. Once there is proof of the service creation provided, Medicaid pays out a specific dollar amount for each service. This seller rate, sometimes referred to as the fee-for-service model, requires the agencies to consistently serve enough Medicaid-eligible clients to break even so amongst their tax tax incomes. The state will just offer a certain rate for outpatient mental health counseling services, for example, regardless of an individual agencys own intragroup cost structure (Smith et al. 2012).The Affordable Care Act (ACA), passed in 2010, has drastically change magnitude the morsel of insured Americans. The ACA, which is frequently nicknamed Obama complaint, prohibited insurance companies from denying insurance coverage based on pre-existing health and vastly grow the number of low-income families eligible for Medicaid. It similarly set a standard requirement for all United States citizens to perplex the minimum essential coverage of healthcare (MEC).Medicaid Funding for NonprofitsThe practice of using Medicaid to supplement nonprofit organizations funds began in the 1980 s. The favorable movement to provide services to the elderly and disabled led to increased government support for social services (US General Accounting Office, 1984). This has expanded greatly since then, with the principal(prenominal) source of care belonging to cognitive content nuisance and mental health services.One blatant benefit Medicaid funding can have for nonprofits is its quick turnaround. Even though its services are aimed generally at high-risk groups, Medicaid funding reimbursed at a much high rate than other insurance options for such population groupings when compared in 2006. Medicaid has boomed in the past several years, having expanded its pool of clients to cover to a greater extent and more people. Reimbursement rates allow nonprofit social service organizations to cross-subsidize their resources to other activities that might not otherwise bid sufficient funding (Smith, 2007).Unforeseen Consequences effectuate of Medicaid on NPO FundingNonprofits exist as a federal condom net to supplement lacking government and community services. Two main problems that arise when deep dependency is placed on publicly funded nonprofit social services. State governments have been recently pressured to reduce spending on programs to make more room in the budget. Additionally, nonprofits must cope with the pressures associated with existence the second order social welfare program of the government. Because all federal and state dollars are allocated at a local level for social service programs, the activity reflects the preferences and capability of the community (Allard Smith, 2014).Medicaid allocates funding to a epoch-making portion of social service organizations in the nonprofit sector, even though such organizations may not primarily be health care providers. Over 50% of the nonprofits focused on mental health and substance abuse reported Medicaid funding in their surveys. Medicaid revenues were also provided to over 40% of those provide rs of mental health or substance abuse services who also engaged in assistances ranging from employment services to emergency response. It is important to note, however, that only 3.2% of these organizations providing employment or emergency services did not provide the surplus substance abuse or mental health services (Allard Smith, 2014). This info indicates that while Medicaid provides funding to a wide range of nonprofits, it does place a significant emphasis on those dealing with health services in its diverse range.An Assessment of the ArgumentsAs discussed earlier, nonprofits receive funding from Medicaid based on the services provided. To receive funding, an organization must show proof of a service provided to an individual. In this way, the funding is based on individual clients pursuance services from nonprofit organizations. The mission of the organization, therefore, influences how much funding it will in the long run receive from Medicaid. In this way, Medicaid fu nding is said to follow clients rather than existence given to a specific nonprofit organization.Nonprofits must factor in this design when creating their mission statement. They can more effectively secure their funding by having a service mission targeted towards populations that receive Medicaid coverage. Additionally, larger organizations are more likely to receive Medicaid funding because they have more resources and stave to provide these services. Conversely, smaller organizations often find themselves less likely to receive Medicaid funding regardless of their mission statement if they do not have the scale to provide as many services as their larger counterparts (Allard Smith, 2014).ConclusionNonprofits largely reliant on Medicaid for their funding may often find themselves at the mercy of elements out of their hand. They depend on the die hard of Medicaid-eligible clients using their services and resources. Thus, nonprofits are dependent on the eligibility of the clie nts they serve. State policies order Medicaid eligibility, so nonprofits are vulnerable to changes in state economics and legislation. Since it is a modest source of revenue for many nonprofits, greater instability and arbitrariness may make Medicaid a less desirable source of revenue (Allard Smith, 2014). While Medicaid might not be able to be concretely predicted, it is still better than not being able to accept Medicaid at all. While it may seem precarious, organizations must adapt to changing sources of revenue regardless of if it is government-funded or not.ReferencesAllard, S. W., Smith, S. R. (2014). Unforeseen consequences Medicaid and the funding of nonprofit service organizations. daybook of Health Politics, Policy Law, 39(6), 1135-1172.Smith, Steven Rathgeb. 2007. Medicaid funding of social services implications for social and health policy. Paper presented at the annual meeting of the American Political knowledge Association, Chicago, August 31.Smith, Vernon K., K athleen Gifford, Eileen Ellis, Robin Rudowitz, and Laura Snyder. 2012. Medicaid today preparing for tomorrow a look at state Medicaid program spending, enrollment and policy trends. Washington, DC Kaiser Family Foundation, Kaiser Commission on Medicaid and the Uninsured.US General Accounting Office (GAO). 1984. States Use Several Strategies to carry on with Funding Reductions under Social Services Block Grant (SSBG).GAO/HRD-84-68. Washington, DC GAO.