Revised Senate Health Care Proposal Still Slashes Funds to Medicaid

The nearly $800 billion cut to the federal low-income insurance program Medicaid is still on the table in the latest version of the American Health Care Act. Photo: Thinkstock.

Though the Senate Republicans’ revised health bill includes additional funding compared to the previous version, health advocates say it would still have a devastating effect on low-income Californians.

They put money on the edges but it doesn’t change the fundamental meanness of the bill and its assault on the health care system,” said Anthony Wright, executive director of Health Access California, a consumer advocacy organization.

Senate Republican Majority Leader Mitch McConnell’s revised bill, released Thursday, follows an initial draft issued last month. The new version includes $45 billion to help fight the opioid addiction crisis and adds $70 billion states could use for health care reforms that could help bring down premium costs. The new bill would also allow consumers to use tax-exempt health savings accounts to pay premiums.

Yet the nearly $800 billion cut to the federal low-income insurance program Medicaid is still on the table.

The transformation of Medicaid from an entitlement program with unlimited funding to one in which federal money would be capped through block grants or fixed per capita amounts also remains in the bill.

Wright is unimpressed with a new provision that would lift the caps in the event of a public health emergency. “The biggest concern we have is not a public health emergency but an aging population as baby boomers enter their 70s and 80s,” he said. “it’s going to be a lot more expensive to take care of an aging population.”

A block-grant approach would diminish access to insurance for low-income people because there would be less money available than under the old entitlement system, Wright said.  That means there might not be enough money to pay for a new blockbuster drug that comes out or to keep up with rising medical costs.

Cary Sanders, the director of policy analysis for the California Pan-Ethnic Health Network, said the “revised Senate bill goes from bad to worse.”

She cited the amendment added by Texas Sen. Ted Cruz, which would allow insurance companies to offer plans with minimal benefits.

“It erodes protections for everybody by creating separate pools,” she said. “Folks that are healthier will be attracted to catastrophic plans that have lower premiums and less coverage. Sicker folks will have to purchase more expensive coverage. It destabilizes the marketplace for everyone.”

The added funding in the revised bill such as the $45 billion to fight the opioid addiction crisis don’t amount to much, Sanders said. “They chose to leave the worst of the cuts in place,” she said. “I see it as merely tinkering around the edges.”

Kelly Hardy, senior managing director for health for advocacy organization Children Now, called the revised bill “the same old same old.” She explained: “It would undercut protections and care for low-income folks and sick people for giveaways to wealthy people.”

She is concerned about a provision that eliminates retroactive Medicaid coverage. As an example, currently if someone shows up at a hospital for a car wreck and doesn’t have insurance, the hospital will help them apply for Medicaid if they qualify and they will be able to retroactively get coverage for those services.  Under the Republicans’ proposal, there would be no retroactive coverage and the patient would be stuck with the bill, she said.

She said that under the Republicans’ initial draft bill, the number of California’s uninsured nonelderly adults would increase by 3.76 million people and the number of uninsured California kids would increase by 539,000. She doesn’t expect those numbers to change under the revision.

The bill could go to a vote as soon as next week. If it passes, it would go back to the House for approval.

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