The Trump administration announced morning that it would cut Medicaid benefits with “Healthy Adult Opportunity” which would give states the option to receive their federal Medicaid funding as a block grant, or a lump sum, to cover vulnerable citizens. However, red states will use this “option” to limit spending and the size of the overall program and then share in the alleged cost savings with the federal government. Many Republican lawmakers said they want to cut the benefits because of the high cost of providing coverage — states only have to pay 10 percent of the total bill for Medicaid expansion under the terms of the ACA.
Consumer advocates and experts maintain that it will lead to limits on benefits and decrease enrollment numbers for a program that provides health care coverage to 70 million Americans. Detractors further said the guidance allows states to shrink provider payments without permission, limit access to prescription drugs, impose premiums on beneficiaries and impose a number of roadblocks to eligibility.
That would have the largest impact on adults who receive care through Medicaid expansion, a program under the Affordable Care Act that provides care up to 138 percent of the poverty level.
Dozens of House Democrats warned that block grants would be detrimental to the viability of Medicaid and patient outcomes because of the negative fallout it would have for Americans who get health care coverage through the “safety-net health program.”
“Medicaid block grants necessitate cost-cutting measures like restricting enrollment, decreasing provider reimbursement, and limiting eligibility and benefits through managed care,” the representatives wrote in the letter, which was organized by Rep. Joe Kennedy, D-Mass. “These actions endanger the lives of the most vulnerable patients, the population Medicaid was created to protect.”
“I’m disappointed to see the administration is effectively removing the access to affordable and needed care that people have under Medicaid through this,” said Jessica Schubel, a senior policy analyst focused on Medicaid at the Center on Budget and Policy Priorities. “Lifesaving prescription drugs could be at jeopardy, states could make decisions that could cause thousands of people to lose coverage, and states would bear more financial risk since federal funding would not adjust to meet the need for unexpected costs from recessions and public health emergencies, like the coronavirus.”
Medical groups and health advocates assert that this will only have negative health outcomes for poor patients and cash-strapped hospitals.
“The document issued today by CMS appears to rewrite bedrock provisions of Medicaid, an activity which is beyond the scope of CMS’s power,” said Jane Perkins, legal director for the National Health Law Program, an advocacy group representing low-income individuals and families. “Only Congress is tasked with making these changes. Our legal team is carefully investigating the enforcement and litigation options at this time.”