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Medicaid issues cloud GOP's plans

Senate bill makes cuts

WASHINGTON — Somewhere along the way, the Republican crusade to repeal “ObamaCare” also turned into an effort to limit the future growth of Medicaid. That bit of mission creep is complicating prospects for the GOP, and could lead to deadlock.

The federal-state program for low-income people has long been stigmatized as substandard. But over time it has grown and changed to become a mainstay for hospitals, nursing homes, insurers, and now drug treatment centers confronting the opioid epidemic. With about 70 million enrolled, Medicaid covers more people than Medicare, from newborns to nursing home residents.

Republicans including Sens. Susan Collins of Maine, Dean Heller of Nevada, and Govs. John Kasich of Ohio, Charlie Baker of Massachusetts, and Doug Ducey of Arizona have all expressed misgivings about the Senate’s GOP health care bill.

On Monday, the National Association of Medicaid Directors, a nonpartisan group that represents state administrators of the program, said in a statement from its board that the legislation is unworkable, and called it “a transfer of risk, responsibility, and cost ... of historic proportions.”

“We would see dramatic reductions in federal Medicaid funding, which would result in large budget gaps for the states,” said analyst Caroline Pearson of the consulting firm Avalere Health.

A Congressional Budget Office estimate released Monday said the Senate bill’s biggest impacts on spending would come from Medicaid. In 2026, the federal contribution would be $160 billion lower than under current law, and 15 million fewer people would be covered through the program.

But Republican leaders are unlikely to retreat, due to political and practical reasons. Although the House and Senate bills differ on timing and some key details, they would basically achieve the same goals:

4 Phasing out the extra financing that former President Barack Obama’s health care law provides to states that expand Medicaid. Thirty-one states have taken advantage of a generous federal matching formula, expanding their programs to mainly benefit low-income adults. About 11 million people have gained coverage. Under the GOP bill, states could continue to serve this group, but would have to accept a lower match from Washington.

4 Putting a limit on future federal financing for the entire program, through a per-beneficiary cap that would be adjusted for inflation. That would effectively end Medicaid’s status as an open-ended entitlement, through which the federal government matches a share of what each state spends. The GOP formula for annual adjustments has sparked a particularly sharp reaction, with critics saying that the Senate decision to use a broad measure of annual inflation simply won’t keep up with faster increases in health care costs.

On the Medicaid expansion, there’s wide agreement among Republicans that Obama’s federal matching rate of no less than 90 percent amounts to wasteful spending. On average, the regular Medicaid match works out to about 60 percent. Many Republicans are strong believers in limiting the growth of health programs.

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