The American Health Care Act Makes Unsustainable Cuts to Medicaid

The American Health Care Act Makes Unsustainable Cuts to Medicaid


Recent policy conversations related to the American Health Care Act (AHCA) have focused on  proposals that would eliminate the Affordable Care Act’s critical protection for people with preexisting conditions. This  controversial proposal has drawn  a lot of attention for good reason. Eliminating this important protection, which keeps insurance companies in the individual (non-group) market from considering health status when making coverage decisions, could hurt millions—especially older adults who tend to develop more health conditions as they age.

But the preexisting condition protection is not the only serious concern. The proposed legislation would also make huge cuts to Medicaid by taking  $880 billion out of the program by 2026. How?  By, among other things, fundamentally changing the way the program is funded. Under the AHCA, Medicaid funding would move from a federal guarantee to match all legitimate state expenditures on health care and long-term services and supports (LTSS) for eligible beneficiaries, to a capped payment system that would give states a fixed dollar amount per enrolled beneficiary.[i]  Although per enrollee caps respond to changes in enrollment, they do not respond to increases in health care costs attributable to medical or pharmaceutical innovation, nor do they respond to other changes in the health care environment that could affect per enrollee spending. Health care costs, we all know, are notorious for their rapid rise. The result: an ever-widening gap between cost and funding.

The impact of such a huge loss of federal Medicaid funds on people with disabilities and poor seniors will be devastating—especially for 11 million Medicare beneficiaries who are also eligible for Medicaid. These individuals—called dual eligibles, or duals—are the poorest and sickest of all Medicare beneficiaries and rely on Medicaid for critical LTSS services, like help with toileting, bathing, and eating.

Faced with major losses of federal funding for their Medicaid programs,  states would have limited options. They could plug the funding hole with state revenues, which is unlikely given competing demands on state budgets. States could also cut provider rates, which could lead to significant access problems for beneficiaires because many providers may choose not to serve the Medicaid population. States could also eliminate optional eligibility categories, including some that provide access to LTSS. Finally, states could reduce or eliminate access to optional services, including home and community-based LTSS. Limiting access to needed LTSS for dual eligibles will most surely result in increased use of emergency room and hospital services, ultimately shifting costs to the Medicare program—creating a “pay me now or pay me later” situation for the federal government.

Rather than take billions  of dollars out of Medicaid and shift significant costs to Medicare and states, it is time to have a reasoned conversation about how to improve the program in ways that don’t leave gaping holes in the health care safety net that millions of people  and their family caregivers rely on.

[i] States have the option of receiving block grant funding for children and non-elderly, non-disabled adults. Block grants are fixed amounts of money that do not respond to changes in enrollment or program costs.

 

 

Lynda Flowers is a Senior Strategic Policy Adviser with the AARP Public Policy Institute, specializing in Medicaid issues, health disparities and public health.

 

 

 

 



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The American Health Care Act Makes Unsustainable Cuts to Medicaid

The American Health Care Act Makes Unsustainable Cuts to Medicaid


Recent policy conversations related to the American Health Care Act (AHCA) have focused on  proposals that would eliminate the Affordable Care Act’s critical protection for people with preexisting conditions. This  controversial proposal has drawn  a lot of attention for good reason. Eliminating this important protection, which keeps insurance companies in the individual (non-group) market from considering health status when making coverage decisions, could hurt millions—especially older adults who tend to develop more health conditions as they age.

But the preexisting condition protection is not the only serious concern. The proposed legislation would also make huge cuts to Medicaid by taking almost $1 trillion (or 25 percent of all Medicaid dollars in 2016) out of the program by 2026. How?  By fundamentally changing the way the program is funded. Under the AHCA, Medicaid funding would move from a federal guarantee to match all legitimate state expenditures on health care and long-term services and supports (LTSS) for eligible beneficiaries, to a capped payment system that would give states a fixed dollar amount per enrolled beneficiary [i]. Although per enrollee caps respond to changes in enrollment, they do not respond to increases in health care costs attributable to medical or pharmaceutical innovation, nor do they respond to other changes in the health care environment that could affect per enrollee spending. Health care costs, we all know, are notorious for their rapid rise. The result: an ever-widening gap between cost and funding.

The impact of such a huge loss of federal Medicaid funds on people with disabilities and poor seniors will be devastating—especially for 11 million Medicare beneficiaries who are also eligible for Medicaid. These individuals—called dual eligibles, or duals—are the poorest and sickest of all Medicare beneficiaries and rely on Medicaid for critical LTSS services, like help with toileting, bathing, and eating.

Faced with major losses of federal funding for their Medicaid programs,  states would have limited options. They could plug the funding hole with state revenues, which is unlikely given competing demands on state budgets. States could also cut provider rates, which could lead to significant access problems for beneficiaires because many providers may choose not to serve the Medicaid population. States could also eliminate optional eligibility categories, including some that provide access to LTSS. Finally, states could reduce or eliminate access to optional services, including home and community-based LTSS. Limiting access to needed LTSS for dual eligibles will most surely result in increased use of emergency room and hospital services, ultimately shifting costs to the Medicare program—creating a “pay me now or pay me later” situation for the federal government.

Rather than take millions  of dollars out of Medicaid and shift significant costs to Medicare, it is time to have a reasoned conversation about how to improve the program in ways that don’t leave gaping holes in the health care safety net that millions of people  and their family caregivers rely on.

 

[i] States have the option of receiving block grant funding for children and non-elderly, non-disabled adults. Block grants are fixed amounts of money that do not respond to changes in enrollment or program costs.

 

 

Lynda Flowers is a Senior Strategic Policy Adviser with the AARP Public Policy Institute, specializing in Medicaid issues, health disparities and public health.

 

 



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Not excited about advance care planning? Here are 8 unorthodox reasons you should be!

Not excited about advance care planning? Here are 8 unorthodox reasons you should be!


Happy-Man-Jumping

By now you’ve surely heard that Medicare is going to pay doctors and other qualified healthcare providers for advance care planning with patients in 2016.

Aren’t you excited?!?

Ok, so if you are not utterly thrilled or even if you are nonplussed about the whole issue, then let me give you a different perspective on why you should rush into your friendly local doctor’s office to make a living will and chat about your future.

Here are 8 unorthodox reasons to create your own advanced care plan in 2016:

 1. You don’t want your Aunt Bertha changing your diapers.

Maybe your Aunt Bertha did change your diapers when you were 6 months old, but do you really want her cleaning your feeding tube and wiping up your poop stains when you are 60? I mean heaven forbid that you end up in a chronically dependent or even vegetative state at such a youthful age, but what if…??? Did you even want to be kept alive in such a state at all…??? Certainly something to think about. Maybe you should give Aunt Bertha a call?

2. The loudest person in your family may not have your best interest in mind.

Oftentimes the loudest relative “runs the show” in the hospital- by guilt, intimidation, and a host of other aggressive or passive-aggressive strategies. If you don’t want “you-know-who” making decisions for you or bullying around your other relatives, while you lie helplessly in the hospital bed, then for Pete’s sake, choose and document your own healthcare proxy today! Make sure they know EXACTLY what’s acceptable and not for you.

3. I’ll bet you know who you DON’T want making decisions for you.

Simply put, some people can handle this kind of pressure and some people can’t. The people who would wilt under life and death decisions on your behalf should NOT become decision makers for you, either by intention or default.

4. Hell hath no fury like your family fighting over your fate or your fortune!

I’ve seen feuds break out around a deathbed that would make the Hatfields and the McCoys cringe. I always want to scream, “What the hell are you people doing? Can’t you see that your loved one is dying here?” (Of course that kind of outburst is never good for the physician professionalism scorecard, so I usually manage to translate the sentiment into something a bit more PC.) So, please, please I beg you to have your fate and your fortunes pre-determined before that fateful and inevitable moment arrives!

5. Grudges can come back to bite you.  

One time the closest available relative to my unresponsive patient on full life support was his estranged wife. She had carried a grudge for 20 years. When we finally tracked her down to make a decision for my patient, with glee she whispered evilly, “Pull the plug.” (YIKES!) I’m pretty sure that guy would have had someone else in mind to make this decision, but IT WAS TOO LATE! No advance care plan was in place with his doctor. (I sense that you are getting my drift…)

6. No one knows your secret priorities.  

During one of my traveling lecture series last year I met a gerontologist who shared some of the idiosyncrasies of his advance care plan with me. He had in writing, that should he become demented and placed in a nursing home: 1) Under no circumstances should he ever be physically or chemically restrained, and 2) He should be allowed to have sex with anyone who is willing to engage him :)

7. No one knows you like you… and you deserve a fitting exit. 

I would like to die on a blanket under the oak tree at bottom of my field. My dad would like to be buried in a bright red racecar motif casket. My husband wants a Viking funeral pyre. I’m sure you have some pretty unique idea about your final goodbye as well… do you have the plan in place?

8. Embracing death will allow you to embrace life. 

Is this too much for you? Think it’s too morbid? Let me tell you the great secret… when you embrace death in its inevitability, then each moment of life itself becomes more precious. Now will never come again. Planning for the end-of-life awakens you to the gift of this very moment of life, this very second. What a gift.

“The doctor will see you now…”



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