Puerto Rico hopes to gain from U.S. healthcare reform

SAN JUAN, Puerto Rico Thu Sep 24, 2009 4:11pm EDT

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SAN JUAN, Puerto Rico (Reuters) - The national healthcare reform pushed by President Barack Obama seeks to provide coverage for every American citizen, but millions of people in Puerto Rico may be excluded from key aspects of the plan.

With Obama having pledged to provide equal treatment for U.S. territories in federal programs, the commonwealth's political leaders see the push for comprehensive healthcare reform as an opportunity to overturn spending caps and other regulations that have resulted in what they see as decades of discriminatory treatment in federal programs.

There are growing doubts, however, about what benefits some 4.5 million residents of Puerto Rico and other U.S. territories would see under the healthcare reform legislation that emerges from a divided Congress.

Critics say the version being drafted this week by the Senate Finance Committee, which is chaired by Democratic Sen. Max Baucus, would do nothing to overturn under-funding of Puerto Rico's Medicaid and Medicare programs by an estimated $2.8 billion annually.

It would also leave residents out of an insurance exchange aimed at providing coverage through subsidies to the working poor.

"The draft circulating isn't acceptable because it wouldn't allow the territories to provide universal health coverage," said Puerto Rico Resident Commissioner Pedro Pierluisi, the island's sole non-voting member of Congress.

"It wouldn't meet the president's goal of making sure all Americans have access to adequate healthcare," he said.

For Governor Luis Fortuno, the island's quest for parity in federal healthcare funding is "a civil rights issue."

"The gross disparity in Medicare and Medicaid funding that Puerto Rico receives in comparison with the states is a historic injustice," Fortuno told a gathering of the San Juan Rotary Club this week before heading to Washington for lobbying efforts.

"DOLLARS AND CENTS"

"It's also a matter of dollars and cents for the government, with Puerto Rico picking up more than 80 percent of the healthcare costs of its poor versus the 20 percent or less for states with similar demographics, where the federal government picks up the balance of the cost," Fortuno added. "The local health program that provides coverage to the island's medically indigent has run up annual deficits of $350 million in recent years."

"The government of Puerto Rico has had to take substantial sums to provide quality health services for our citizens," the Republican governor added.

The rationale for the disparity in treatment appears to be cost, which in Puerto Rico's case amounts to about $2.8 billion less annually in Medicare and Medicaid expenses than it would receive if it were treated as a state.

Supporters of the current formula note that most residents of the U.S. commonwealth do not pay federal taxes.

But proponents of a funding fix say that no Medicaid beneficiaries -- the country's poorest residents -- pay taxes, and Medicare beneficiaries on the island pay the same taxes as stateside residents.

"Our local government has been forced to carry a much larger economic burden than other states when we are talking about healthcare," said Fortuno.

"If the reform is necessary to control costs in the United States, it's vital that Puerto Rico is included entirely in the efforts of Congress."

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