These Americans will be negatively affected if the Senate Republicans’ health care bill become law, Vox reports.
The actual policies contained in the Better Care Reconciliation Act, the Senate Republican plan introduced on Thursday to repeal and replace Obamacare, would help some Americans a lot. The biggest winners are households making $250,000 a year or more, which would see two different taxes targeting them repealed; households with millions in investment income would come out particularly far ahead.
But vastly more Americans would come out behind. 22 million will lose health care coverage, according to the Congressional Budget Office estimated would lose insurance under the bill that passed the House in May. Medicaid beneficiaries will have to deal with $774 billion in cuts over ten years, plus additional ones in years after that.
And because the bill substantially weakens regulations for both individual and employer plans, millions of people who still get insurance will see the extent of their coverage shrink, and see themselves forced to pay out of pocket for expensive procedures that would otherwise be covered.
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The list of people losing out from the bill doesn’t end there, though. Here are a few of the main groups that will be negatively affected if this legislation becomes law.
Of the 22 million people the CBO projected would lose coverage under the Senate bill, 15 million are currently covered by Medicaid, which the bill would cut by about $774 billion over 10 years.
These are the poorest and most vulnerable people who’ll lose insurance under the bill.
In the 31 states (and Washington, DC) that expanded Medicaid following the Affordable Care Act, all adults earning up to 138 percent of the poverty line are eligible for Medicaid. Non-expansion states often feature much lower income thresholds to qualify for Medicaid, particularly for non-parents — but they will also see people lose coverage.
The BCRA would effectively end the Affordable Care Act’s Medicaid expansion starting in 2021. Under current law, the federal government initially paid 100 percent of costs of Medicaid expansion beneficiaries, a percentage set to wind down to 90 percent in 2020 and stay at that level permanently. Under the BCRA, the federal government would gradually wind down that percentage to the states’ normal matching rates for Medicaid — rates that are as low as 50 percent in certain states.
The Congressional Budget Office has argued that this will mean no more states pursue expansion. It will also spark states with “trigger laws” — which end the expansion if there’s any reduction in the federal match — to automatically abandon it starting in 2021. Those states are Arkansas, Arizona, Illinois, Indiana, Michigan, New Hampshire, New Mexico, and Washington.
Joan Alker, a Medicaid expert at Georgetown University, estimates that those eight states alone could lead to 3.3 million Medicaid enrollees losing coverage. But many of the other 24 states will abandon the expansion due to the lower match rate as well. And keeping it going will be even harder due to other, fundamental changes the bill makes to the Medicaid program.
But it’s not just people who gained coverage under Obamacare’s Medicaid expansion who would lose out. The law would also adopt a policy known as a “per capita cap” for Medicaid that would hurt all beneficiaries.
Currently, the federal government matches state spending on Medicaid, offering about $1 to $2.79 for every dollar states spend on it. Poorer states get a bigger match. But the BCRA would change all that.
Rather than matching state Medicaid spending, the AHCA would give each state a set amount of money per person. Until 2025, the amount would grow from year to year according to the medical component of the Consumer Price Index, to account for inflation. Then it would switch to the overall CPI.
The medical component of CPI is growing more slowly than Medicaid costs are expected to grow right now, according to the Center on Budget and Policy Priorities, and the CPI as a whole grows far more slowly. So switching to a per capita cap is essentially a federal cut to Medicaid amounting to hundreds of billions over 10 years. We’ll have to wait for the CBO report to know exactly how many hundreds of billions.
A per capita cap is at least somewhat responsive to changes in Medicaid enrollment — unlike a block grant, which gives states a set amount of money, it gives them a set amount of money for every person who’s eligible. But it could lead to cuts in some other ways as well. Take a state like Florida that’s aging fast. The BCRA includes separate caps for different groups of beneficiaries — the elderly, disabled, non-elderly adults, etc. — so states can’t get more money by dumping lots of seniors in favor of 24-year-olds.
However, there is still a lot of variation in cost within those categories. “Within your elderly group, you have the young and old, 67-year-olds and 85-year-olds, and the latter are much more expensive, ” Georgetown’s Alker told me in March. A state like Florida, which has a large senior population, could see costs rise fast as its population ages with time. But a per capita cap wouldn’t keep up with that. To get around that, the state might be motivated to kick off older seniors and focus enrollment on younger ones.
There are some federal requirements as to whom states must cover, but they only go so far, and most states now provide additional coverage that they can roll back. “You do have to cover people on Supplemental Security Income” — a program for disabled, elderly, and blind people with low incomes — “but a lot of folks in nursing homes [are] optional coverage, ” Alker continued.
This helps explain why disability rights activists are appalled by the per capita cap plan. “People with disabilities who rely on home- and community-based services through Medicaid — such as personal-attendant care, skilled nursing, and specialized therapies — could lose access to the services they need in order to live independently and remain in their homes, ” the Center for American Progress’s Rebecca Vallas, Katherine Gallagher Robbins, and Jackie Odum note.
As if that weren’t enough, the bill has also been changed to allow states to impose work requirements on Medicaid, a policy that would not effectively spur people to work or reduce poverty but that could meaningfully reduce access to care for poor families, and which even many conservative health care experts oppose.
A per capita cap would also cause problems if a new, expensive, but necessary drug comes on the market, or an epidemic hits. Those are both changes that would raise the per capita amount Medicaid has to pay year to year, but which a per capita cap wouldn’t budget for.
For instance, the opioid epidemic has taxed state Medicaid programs as more patients need treatment for substance use disorder. Today, an increase in need leads to an automatic increase in federal funds flowing to states. But the Republican plan would halt that and put the whole burden on states. To try to make up for that, it adds a mostly symbolic $2 billion fund to address the opioid crisis, which almost certainly wouldn’t be enough to address this problem.
The BCRA also allows states to forgo the per capita cap and adopt an even more drastic reform if they want to: a full block grant. States would get a fixed pot of money for Medicaid over a 10-year period, increasing every year only with the normal inflation rate. There would be absolutely no allowance for increased population, or for increased need during recessions. States would be forced to raise taxes or restrict eligibility when federal funds inevitably prove inadequate. Seniors and people with disabilities would be exempted, but would inevitably be hurt as the program itself undergoes cuts.
Why would states choose to take this much less money from the feds? Because, as Edwin Park, Judith Solomon, and Hannah Katch at the Center on Budget and Policy Priorities explain, the block grant also provides states with ” virtually unfettered flexibility to decide how to spend the federal funds they receive .… Under the block grant, states would no longer have to comply with most federal Medicaid requirements for children and adults. States could immediately cut eligibility and benefits to avoid any shortfalls and they would be allowed to carry over unused funds to the next year.”
States would no longer be required to cover poor parents. They could charge unlimited premiums, deductibles, and copayments. They could impose enrollment caps and waiting lists, and they could cut the range of services provided to poor children.
“Over time, states electing the block grant would be forced to use this flexibility to make increasingly draconian cuts to their Medicaid programs, as the block grant funding cuts became increasingly severe, ” Park, Solomon, and Katch write.
A new provision in the Senate bill, not in the House version, offers additional federal funding for states whose per-beneficiary spending on Medicaid in various categories comes in more than 25 percent below average, and reduces funding for states where it comes in more than 25 percent above average.
