Update on Healthcare Reform: Medicaid, Not Just the Expansion, at Risk

In his first address to Congress, President Donald Trump illustrated the controversy among GOP lawmakers on the Medicaid expansion aspects of the Affordable Care Act (ACA) by ensuring that “no one [would be] left out” of receiving coverage in the Republican ACA replacement.  Rollback of the Medicaid expansion under the ACA would impact millions of low income people and would reduce funding for many housing-related services (see Memo, 2/27). An additional issue related to healthcare reform concerns a forthcoming piece of legislation to replace the ACA leaked on February 24th that would threaten Medicaid itself.

Representative Mark Walker (R-NC), chair of the Republican Study Committee, and Representative Mark Meadows (R-NC), chair of the Freedom Caucus, have already announced opposition to the leaked legislation primarily because of its provision to establish new age-based tax credits and creation of a “new entitlement program.”

Advocates for low income families are troubled not only by the prospect of legislators rolling back Medicaid expansion, but also the bill’s proposal to change the entire structure of Medicaid to either a block grant or per-capita capped form of financing. Mr. Trump presumably was referring to these options when he emphasized in his address the need for “flexibility” in Medicaid spending. The Center on Budget and Policy Priorities (CBPP) has laid out how either alternative would dramatically reduce Medicaid funding over time and leave states with fixed pools of money, unable to address the changing cost of health care standards or emerging health needs related to an aging population or a more acute emergency like a pandemic. There exist strong differences of opinions about block grants and per-capita financing among governors, with Governor Gary Herbert (R-UT) voicing his support for these features amid strong opposition to them from Democratic governors at their recent governors’ meeting.

Restructuring of Medicaid would end the program as it is, forcing states to ration care and bear the risks of unanticipated cost increases. Such restructuring would also reduce states’ ability to improve care while decreasing costs through innovations such as providing medical homes and housing-related services.

Housing advocates and partners can act now by sharing information in the links below, contacting members of Congress about what is at stake, and educating the public through op-eds, letters to editors, social media, and other means.

For more on the principles Mr. Trump cited in his address, go to: http://cnb.cx/2mKayD3

To view CBPP’s new tool analyzing the impacts of ACA reform proposals, see: http://bit.ly/2kKwEs9

The leaked House of Representatives health bill is at: http://politi.co/2mg7gLU

A brief review of changes proposed in the bill is at: http://theatln.tc/2l8lzBQ

More on GOP opposition to the proposed replacement bill is at: http://bit.ly/2mtmCg8

More on the disagreement among GOP and Democratic governors on a per capita cap is at: http://nyti.ms/2mAtAMU

More from CBPP on why block grants could result in reduced coverage is at: http://bit.ly/2kMp00N

More from CBPP on why per capita caps and block grant structuring of Medicaid could reduce benefits, reduce coverage, cut payments to providers, and shift costs and risks to states overall is at: http://bit.ly/2lRWo66

CBPP state fact sheets on the impact of ACA repeal are at: http://bit.ly/2hqYDr9