By: Theo Smith // March 26, 2020
In late January 2020, the Center for Medicare and Medicaid Services (CMS) revealed a plan that would allow states to apply for waivers to block-grant Medicaid funding.
Medicaid is a federal and state program that provides low or limited income individuals and families with health resources and services. These block-grants allow local and state authorities to allocate money to a wide range of services outside of the Medicaid program.
This plan would change the Medicaid program by limiting health services that were previously funded by the federal government. Patient advocates say this proposal has the potential to drastically change health plans and insurance coverage.
According to the National Health Law Program, a progressive health policy organization that focuses on Medicaid eligibility litigation, there are 74 million people covered by Medicaid in the U.S. The proposed CMS guidance would restructure the Medicaid program and radically affect health insurance for recipients.
Hannah Eichner, a policy fellow at the National Health Law Program, explained how the Medicaid program fills gaps in the current health care system and picks up the slack that private insurance plans miss.
“Medicaid allows people access to health care that can’t afford private insurance,” said Eichner. “These block grants are extremely problematic because they would cut coverage for people who need it the most.”
In a statement last week, Leo Cuello, Director of Health Policy at the National Health Law Program, expressed disappointment in the CMS proposal.
“These block-grants would be devastating for any state that attempts to implement them, and any irresponsible state leader that pursues this policy will be acting against his or her state’s interests and the people who depend on Medicaid for their health insurance coverage,” said Cuello.
Currently, one in five low-income Americans rely on Medicaid for health insurance. Additionally, college students around the country rely on Medicaid’s out-of-state health services. American University Sophomore, Ahmad Hamid, expressed how D.C. Medicaid has serviced his health needs.
“Since I don’t have health insurance, when I go to the University health center I have to pay a larger fee than other students,” said Hamid. “Because of this, I typically use services off campus because it’s so much easier and cheaper.”
The Trump administration claims this new program would allow states to offer more benefits to patients and directly control government spending. However, many health advocates, insurance providers, and patients have spoken against the proposal due to its ability to undermine insurance for the poor.
The current CMS Administrator, Seema Verma, disclosed that the newly named program, “Healthy Adult Opportunity,” would be an important step for conservatives; like Oklahoma Governor, Kevin Stitt, who have been trying to prevent Medicaid growth. Many conservative states including Idaho, Oklahoma, Utah, and Indiana, have expressed interest in controlling their own funding and support the guidance outlined by the new waivers.
“These waivers are a lose-lose situation for people covered by Medicaid,” said Eichner. “For the most part, states would cut funding for expanded Affordable Care Act coverage and family planning services.”
The Affordable Care Act (ACA), more commonly known as Obamacare, provides more than 20 million Americans with health insurance coverage. This monumental federal statute increased coverage and access to health care services for people around the country.
“The point of the ACA was to invest billions of dollars on preventative health care now, in order to save trillions on services later,” said Aimee Richardson, health educator at Kaiser Permanente. “The backlash from the new plan will come at a huge cost, not financial but human.”
Health experts from the National Health Council, the American Medical Association, Avalere Health, and many more, argue that altering flexibility on available Medicaid services would be far more harmful than beneficial.
“We didn’t wait for the ACA to work, we didn’t give it the time it needed in order to be effective,” said Richardson. “The constant changes to [the ACA] is fracturing the system in a way that will be irreversible.”
When the ACA passed in 2010, it expanded services to a wide variety of people including the unemployed, pregnant women, children and college students. One of the most important aspects of the ACA and Medicaid is that there are built-in protections that ensure that states provide people with high-quality health care.
“When I was in school I couldn’t afford to use the health center for my primary care needs,” said recent American University alumna Maisha Hoque. “I was covered by Obamacare and was able to use the services in DC, even though it wasn’t my permanent residence.”
The Trump Administration’s proposal would force states to take on more financial responsibility and allow flexibility of available services for Medicaid enrollees. The current system requires the federal government to pick up 90% of the financial burden of Medicaid and Medicare services.
States have a balanced budget and can’t take on debt. Accepting these waivers would increase the financial risk of a state’s economy. Several states, including Maine, California and Nebraska, have been speaking out against the CMS proposal.
“States wouldn’t just be cutting funding,” said Richardson. “They would be cutting opportunity, access, and the possibility of a healthy future for those who are enrolled in these plans.”
These block-grants allow states flexibility in choosing which core protections, established by the ACA, insurance plans offer. According to the Center on Budget and Policy Priorities, a non-partisan think tank that analyzes federal and state budget policies, states who accept the waivers should expect to face litigation, as the announced plan violates federal law.
“Health policy is an extremely polarized issue and has become increasingly so in the past 10 years,” said Eichner. “It’s difficult to get a general consensus about a piece of legislation or new health plan. So to say that there is strong opposition against this plan is a big deal.”
Ahmad Hamid, 19
Advanced Reporting Times, Spring 2020 