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When he signed the law in February on which the rule is based, President Bush said this and other cuts would bring needed restraint to Medicaid spending. The administration wants to cut $25 billion from Medicaid over the next five years. Next year, the federal portion of Medicaid is estimated at $196 billion.

But state officials call the rule a short-sighted strategy that will cut sharply into programs that not only are effective, but also will reduce government costs down the road by limiting the number of broken families and children who fail at education and at life.

Some help less affected

At least 38 states use targeted case management. The local match for the federal dollars is different in each state. In Minnesota it is matched by an equal amount from counties.

State and county officials said Monday that it will take weeks to calculate how the 27-page rule affects Minnesota.

"We're still trying to get a handle on all of this," said Patricia Coldwell, health and human services policy analyst for the Association of Minnesota Counties. I brought the rule home to read over the weekend," she said late Friday.

The rule takes effect March 4, after a comment period that ends Feb. 4. States and counties will ask that the rule be eased.

"We'll tell them that targeted case management helps our counties keep children safe, helps keep families together," Coldwell said.

The timing is difficult for Minnesota counties. Hennepin County is about to approve its 2008 budget -- too late to make changes and pick up some of the slack left by the new rule.

"Even if we had the money, we're still trying to figure out exactly how much we'll lose," Huskins said. "We had thought it might be $9 million. Now it looks like $12 to $14 million."

Describing how the service helped a 13-year-old runaway, state Human Services official Erin Sullivan Sutton testified in July before Congress that without it, "Anna would ... have been hospitalized or placed in a resident



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