Why Trump's Block Grants For Medicaid Face Opposition
Nov 27, 2016 @ 09:46 AM 9,780 views
Bruce Japsen, Contributor
I write about healthcare from President Obama's hometown
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Medicaid, which is jointly funded by federal and state tax dollars, covers more than 73 million Americans
sweeping changes like those currently under consideration are likely to produce far more substantial fallout
The idea by president-elect Donald Trump to change how Medicaid coverage for poor Americans is financed by giving block grants of money to states will face a tough time becoming a reality.
Medicaid, which is jointly funded by federal and state tax dollars, covers more than 73 million Americans . The block grant idea would essentially set spending limits and hopes to save money “without federal overhead,” according to Trump’s seven-point healthcare reform proposal .. https://www.donaldjtrump.com/positions/healthcare-reform . But there are problems with his idea to dramatically alter what has become the nation's largest health insurer, according to analyses .. http://www.commonwealthfund.org/publications/issue-briefs/2016/nov/medicaid-block-grants .. beginning to emerge since Trump’s election.
President-elect Donald Trump, left, talks to media as he and Vice President-elect Mike Pence arrive at the Trump National Golf Club Bedminster clubhouse, Sunday, Nov. 20, 2016 in Bedminster, N.J.. (AP Photo/Carolyn Kaster)
“Any attempt to restructure federal financing for Medicaid and replace flexibility with strict spending limits—whether in the form of block grants, per capita limits on spending, restrictions on what counts as state expenditures or a combination of all three—would divorce funding considerations from the real-life needs that have informed federal and state Medicaid policy for half a century,” according to a new analysis from the Commonwealth Fund by Sara Rosenbaum and colleagues from George Washington University .. http://www.commonwealthfund.org/publications/issue-briefs/2016/nov/medicaid-block-grants .
The Commonwealth report indicates moving to block grants might restrict the amount of money states have to invest in healthcare services, particularly in states that have larger numbers of poor Americans. Lobbies for healthcare providers like the American Medical Association have said following Trump’s election that any proposal by Congress to replace or alter the Affordable Care Act shouldn’t cause patients to lose coverage.
“Crucially, a per capita cap would permit population growth to occur,” Rosenbaum and colleagues say in the Commonwealth Fund report. “But the limit of lawmakers’ appetite for continued growth in enrollment is unclear. Given how states responded to the relatively mild and temporary funding reductions the federal government enacted in 1981, sweeping changes like those currently under consideration are likely to produce far more substantial fallout .”
The substantial fallout would hit not only doctors and hospitals that are opposed to reducing coverage, but any repeal of the ACA would also hit health insurers hard.
Consulting firm PwC said earlier this year in a report that 73% of Medicaid beneficiaries--or 54.7 million of the 75.2 million Americans covered by the health insurance program for the poor--are enrolled in private plans. “Since 2013, private Medicaid health plans have added 20.5 million to their rolls, while those in fee-for-service or public managed care has decreased 2.8 million,” PwC’s Ari Gottlieb, the report’s author, wrote in the 14-page .. http://www.pwc.com/us/en/health-industries/our-perspective/thought-leadership/state-of-medicaid.html .. analysis released at the Medicaid Health Plans of America annual meeting last fall.
It’s been a boon for health insurance companies including Aetna AET -2.72%, Anthem WLP +%, Centene CNC -0.35%, Humana HUM +2.24%, Molina and UnitedHealth Group UNH +0.26%. While UnitedHealth and Humana have scaled back in ACA coverage purchased on exchanges, they, like other health insurers, are happy with how Medicaid expansion is working.
"The increase in Medicaid benefit coverage has been a clear success of the Affordable Care Act, serving millions more Americans and using public funds in the most effective way," UnitedHealth Group president David Wichmann said last month on the company's third-quarter earnings call. "Our ability to improve quality and outcomes for all types of Medicaid beneficiaries, including those with some of the most complex medical conditions, has driven distinguished overall growth for us for a number of years, including organic growth of 9% or nearly 500,000 people in the past 12 months."
Which is all consistent with concerns about Trump's block grant proposal as expressed in your article and other places by both Republican and Democrat Congress critters.
Trump's plan from his federal perspective looks simpler - hey, let the States take any static arising out of tough decisions to be made - so the block grant plan in his mind might feel to satisfy his 'make simpler' promise .. as for his more important promises of universal coverage and lower deductibles, well, guess he could see those 'as off his plate' .. after all, all the nitty gritty would become the states responsibility, with any cuts in coverage or quality not Trump's fault.
Paul Krugman agrees that Medicaid expansion has been a success.
The Medicaid Two-Step
August 17, 2015 9:40 am August 17, 2015 9:40 am
The estimable Charles Gaba notes the latest in Obamacare denialism .. http://acasignups.net/15/08/15/heritage-foundation-interviews-itself-comes-shocking-conclusion ; OK, say the usual suspects, maybe the number of insured Americans has risen, but it’s mainly because of Medicaid expansion. As he says, this is only shocking if you consider Medicaid recipients somehow not worth counting, because, um, well.
Actually, however, this is an even worse argument than Gaba indicates. You see, before the ACA went into effect the very same people loudly insisted that expanding Medicaid was worthless, because instead of insuring more people it would mainly crowd out private insurance .. http://theincidentaleconomist.com/wordpress/extrapolate-medicaid-crowd-out-estimates-with-caution/ , making only a small dent in the number of uninsured Americans.
And maybe the Medicaid expansion has in some cases led people to drop the private coverage they would have had otherwise. But the number of uninsured has dropped sharply .. http://www.cdc.gov/nchs/data/nhis/earlyrelease/insur201508.pdf , especially in Medicaid expansion states. So if there was crowding out, it was more than offset by the expansion in private coverage due to the other features of Obamacare.
The point is that even aside from the facts that Medicaid is real insurance and Medicaid recipients are real people, the whole “but it’s just a Medicaid expansion” claim is outrageous coming from people who insisted just the other day that expanding Medicaid wouldn’t work.
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