Why you should care about radical Medicaid changes

Kellyanne_Conway-214x300Don’t  tune out because conventional wisdom suggests it’s “just” a program for the poor. The partisans’ planned push for changes to Medicaid could have significant consequences for millions of Americans, many of them middle-class, older, disabled, and sick.

The Medicaid changes, as various officials like counselor to the president Kellyanne Conway, have described them without detail for now, also could stagger state and local governments’ finances, including the already strapped District of Columbia, which might see a half-billion- to billion-dollar hole blown in its budgets.

Although significant and merited public attention has focused on the GOP’s crusade to repeal and replace the Affordable Care Act, aka Obamacare, and especially how it affects health insurance, many Americans may not be as riveted by what happens to Medicaid. Republicans have reviled for years now a part of the ACA’s reforms that expanded the government program, but only, as a result of a U.S. Supreme Court decision, if states agreed. Thirty-one states and the District of Columbia did so, 19 did not. This meant that 11 million Americans, most of them the working poor, received health care coverage via Medicaid.

It also, to the ire of the GOP, further entrenched the government in health care, as Money magazine explains of Medicaid:

Contrary to popular belief, Medicaid is not just a benefit for low-income Americans. It’s actually the nation’s largest health care program, covering 74 million enrollees, or about one in four Americans. Some 60% of Medicaid’s spending is for the elderly and the disabled, many of whom come from middle-class households.

D.C. officials estimate that more than 262,000 residents, roughly 40 percent of the District’s population, are covered under Medicaid, with more than 75,000 of them receiving this health support only after the ACA expansion. The numbers of Medicaid recipients in the District dwarf those who get coverage under Obamacare health insurance exchanges.

What Medicaid does

Before examining how and why Republicans want to slash this valued program, let’s also be clear about what it accomplishes, with Money, again, providing some neatly enumerated categories:

  1. Although they number only 15 percent of program enrollees, 40 percent of Medicaid spending goes to the disabled — and millions of families, many middle class, would suffer immeasurably if they alone had to carry these costs for loved ones with development disabilities, severe handicaps, and mental illnesses. Many of these Americans require costly, lifetime care.
  2. The elderly are just 9 percent of Medicaid participants but get 21 percent of program spending. Relatively few Americans, even those with means, adequately prepare for care when they’re old. Many run out of money, with 70 percent of nursing home residents ending up on Medicaid.
  3. The Children’s’ Health Insurance Program, nicknamed Chips, protects the health of as many as 40 percent of the nation’s youngsters, many of them poor, up to the age of 19. In some states, as many as three-quarters of poor kids don’t suffer health ravages only because of Medicaid. The program also pays for just under half of births in the country.
  4. Because Medicaid shoulders huge financial burdens for high needs Americans, the rest of us don’t see these sky-high costs factored into our health insurance, which is less expensive, accordingly.

I’ve also written how, under the Affordable Care Act, officials pressed doctors and hospitals, especially through Medicaid and Medicare, to reduce costs and to improve safety, efficiency, and effectiveness in the health care system, for example, with bundled payments for hip and knee replacements —  an increasingly common procedure for seniors.

Weighing all these benefits, opponents still cry waste, fraud, and abuse as one of their reasons for attacking Medicaid — and this clearly exists in the $552 billion program. I’ve written how the previous Administration created a task force and had scored some big prosecutions of the low-lifes who chiseled from Uncle Sam.

But, when Medicaid operates more efficiently than private insurance and its per beneficiary costs rise slower than private employer efforts, why gut it and why not expand it?

Some cruel conclusions about race and income can be drawn from results of studies that have examined health outcomes in states that have declined to expand Medicaid, as some health researchers wrote, noting,

 Low-income adults in Medicaid non-expanding states, who are disproportionately represented by blacks and rural residents, were worse off for multiple health-related outcomes compared to their counterparts in Medicaid expanding states

Eliminating a sustained commitment

To be sure, there is a fiscal argument to be made about Medicaid, for which states and the federal government split costs. The ACA temporarily increased Uncle Sam’s share as an enticement for states to expand the program. Some officials balked, arguing that they did not want to get stuck with a big Medicaid bill down the road.

But beware of the eye-glazing arguments that will ensure over partisans’ proposals to make major changes in Medicaid, reducing the money budgeted for it and sending sums to state via block grants and allowing governors and legislatures to “experiment” with approaches that just maybe, might, possibly, hopefully will be cheaper, safer, and more accessible, and more effective.

This move would cut off the sustained federal commitment to Medicaid, allowing lawmakers to alter its funding year by year. The research also has shown that over time politicians tend to slash their funding for block grants, meaning states, with already reduced money  through them, would see even less in the future.

How will states do less with more? Giving them more leeway has resulted in some plans where recipients must put “more skin in the game,” meaning they get lower benefits, and in some cases that the already poor are forced in complicated ways to pay money they don’t have to keep up services and benefits. With no insult intended, it’s also a fascinating idea to kick from national expertise to states to sort out challenging, complex health care policy issues, especially given that those in the field see just three states (California, New York and Pennsylvania) having full-time lawmakers with extensive support staff.

In the name of fiscal rectitude and reducing government’s role, of course, partisans insist that changing Medicaid to block grants should be just part of a huge shift in health care, including the repeal and replacement of Obamacare, as well as “reforms” to Medicare and Social Security. Their leading thinkers suggest, for example, that seniors should wait longer to qualify for Social Security and they might get fixed sums to find and buy their own health care insurance, instead of getting financially guaranteed coverage under Medicare.

Here’s the challenge for us all: Can we, as ordinary taxpayers, monitor and let our views be heard when fulltime politicians, policy-makers, lobbyists, regulators, and lawmakers make aggressive moves on so many complex, detailed — and beneficial —health care programs in short order? Will partisans, tactically, back off their assaults on the usually well-defended Medicare and Social Security programs knowing that they can hit Medicaid? I see in my practice how patients injured while seeking medical services face enormous medical bills and years of expensive care. Often, they can no longer work to pay for what they need. Some may find resolution in lawsuits in the civil justice system. Many will need our collective goodwill and assistance through programs like Medicaid, Medicare, and, yes, under Obamacare. We need to ensure these benefits don’t get slashed or burned.

Photo credit: Gage Skidmore, Creative Commons

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