House GOP Plan would Dismantle the Medicaid Program
Leaves Taxpayers on Financial Hook & Abandons Federal Government's Responsibility to Provide Basic Level of Health Care
“Keeping America Healthy” – that’s the motto of the Medicaid program, established more than 50 years ago to provide health coverage to low-income people. The program – one of the largest insurers in the nation – has seen dramatic improvements in eligibility processes, health care delivery and access in the seven years since the Affordable Care Act was signed. Medicaid – known as Medi-Cal in California – today covers 1 in 3 Californians, counting 14 million children, adults and seniors on its rolls.
On Monday, House Republicans made it clear that “keeping America healthy” is the least of their priorities as they released their plan to “repeal and replace” the Affordable Care Act. The House GOP plan would fundamentally alter Medicaid, changing longstanding eligibility principles, shifting costs from the federal government to states and counties and undoubtedly increasing the number of uninsured.
While there is much to be alarmed by in the House legislation, we focus here on three significant eligibility changes and cuts to Medicaid eligibility. Everyone should be concerned about these aspects of the Medicaid program, because all taxpayers – yes, this means you, regardless of how you access health care – have skin in this game. In these bills, House Republicans appear all too eager to abandon the government’s responsibility to provide a basic level of health care to all Americans and to leave you on the financial hook instead.
Whether you know one (or whether you are one) of the 14 million Californians receiving health care through Medi-Cal or not, consider this: Your taxes can be wisely and strategically invested to continue supporting Medicaid, a key reason why California’s uninsured rate is now just 7.1 percent; or you can pay an ever-increasing amount for your health insurance – whether you are covered by a government program, shop on the private market or receive insurance through your employer – as insurers and providers pass these shifted Medicaid costs on to you and your employers in the form of higher premiums, greater cost-sharing and reduced benefits.
Here are key ways the House bills pull apart Medicaid eligibility, at times in hidden ways, and what you can do to raise your voice in opposition:
Limitations on Retroactive Coverage: Under the House Republican plan, Medicaid coverage would start in the month in which an individual applies for benefits. This sounds logical, but is actually a major change that has implications not just for these recipients but for health care providers, too. Under current law, retroactive coverage is available for as many as three months prior to the month a person applies, and can be requested up to one year from the application date.
Here’s an example of how the rule works: Take the case of Courtney, a 30-year-old who is nine months pregnant but loses her health insurance when her husband unexpectedly loses his construction job. When Courtney goes into labor a few days later, her family is hit with enormous medical bills they cannot afford. When Courtney receives the bill a couple of months down the road and calls the hospital to explain the family’s inability to pay, the hospital advises her to apply for Medi-Cal. If it turns out her family was eligible for benefits during the month she gave birth, Courtney can receive retroactive Medi-Cal coverage to pay for the cost of her delivery. She no longer has to worry about paying this massive medical bill or potentially having to declare bankruptcy as a result of the medical debt. The hospital in her city receives payment, rather than absorbing the costs of her unpaid care. Other users of that hospital no longer face the prospect of higher costs to help cover that uncompensated care.
This rule, which predates the Affordable Care Act by decades, would be eliminated by the GOP bill. While it may seem to save money in the short run and improve the bill’s Congressional Budget Office score, eliminating retroactive coverage is a losing proposition for everyone. This action would shift large, uncovered healthcare costs for emergencies, traumas, and other significant medical services to taxpayers, hospitals, and providers, and result in more unpaid medical debt and related bankruptcies to consumers.
Two additional features of the House GOP package have similarly shortsighted effects.
Elimination of Temporary Benefits: The House Republican plan would delay health coverage for citizens and legal immigrants until verification of their status is fully in place. But verification already is required for all U.S. citizens and lawful immigrants who are applying for benefits. Because all such applicants must give a valid Social Security Number and sign their applications under penalty of perjury, and many checks and balances are in place to catch fraud, current law allows these applicants to receive health care while the verifications are being obtained. Often applicants need time to locate their birth certificates or other verification documents that may have been lost during emergencies or frequent moves. The temporary benefits provision allows people to receive health care when needed without delay. (A similar provision that we’ll blog about in the future, that allows hospitals to help enroll people more quickly, is also on the chopping block.)
Requiring states to delay benefits while collecting paperwork will force costly computer reprogramming, create a more time-consuming process for administrators, and prolong the period that individuals go without coverage. Delaying care for people who are citizens or in the country legally is nonsensical, and further hikes everyone’s overall healthcare costs.
Changing Renewal Period from Annual to Every Six Months: The House Republican plan calls for individuals eligible under the Medicaid expansion to renew their coverage every six months rather than annually. The pre-ACA process and paperwork to renew coverage caused frequent churn in the program. Before changes made by the ACA streamlined requirements, individuals who were dropped off the program often come back to the counties to re-apply again at some point in time, leading to duplication of work and immense inefficiency. Introducing rules that again increase churn will increase administrative costs for states – costs that taxpayers will have to foot. In reality, this is a back-door way to phase out federal financial responsibility for the ACA’s Medicaid expansion, a topic we’ll cover in our next blog post.
The bottom line is this: When costs are dramatically shifted and eligibility is radically changed for how low-income children, families, individuals and seniors receive access to health care, we all pay the price. It’s why we must all pay attention and hold our elected officials accountable as they seek to not only to repeal the Affordable Care Act but dismantle the Medicaid program, our country’s safety net for health coverage.
What you can do:
- To learn more about the changes to Medicaid eligibility, read the CWDA letter opposing the American Health Care Act and share it with your community partners and networks.
- To voice concern with the proposed changes, call the Capitol switchboard at 202.224.3121 to be connected to your representative and share your concerns. No one should lose health coverage or experience an increase in costs or reduction in coverage due to changes Congress or the Trump Administration enacts to ACA.
- Make your voice heard on social media using #Fight4OurHealth and #ProtectOurCare, and encourage family and friends to do the same.
– Cathy Senderling-McDonald
Cathy is the Deputy Executive Director of CWDA.