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May 2017 U.S. Poverty Action
Call Senate Health Aides to Protect Medicaid
On May 4, the House of Representatives passed the American Health Care Act (AHCA) by a vote of 217-213. This bill would appeal large parts of the Affordable Care Act (ACA, also known as “Obamacare”) and make radical changes to America’s health care system. In particular, the bill would make dangerous changes to Medicaid, the largest health insurance program in the U.S. It would cut $880 billion from Medicaid and cap the amount of money states would receive from the federal government to cover patients. The Congressional Budget Office estimates that 14 million people would lose health coverage under Medicaid alone (see more on reverse side).
The bill now goes to the Senate to debate and passage. While the Senate is expected to make some changes to the House bill, the threats to Medicaid remain. The Senate could vote in a few short weeks. Set up a conference call between your RESULTS group and health aides for both your Senators urging them to protect Medicaid.
Tell Senators to Protect and Strengthen Medicaid
Medicaid, created in 1965, is America’s largest health insurance program, covering approximately 75 million low-income Americans. Seventy-five percent of Medicaid spending goes for hospital care, physician services, and prescription drugs. The remaining amount covers nursing home and other long-term care services (60 percent of nursing home care in the U.S. is paid for by Medicaid).
Under Medicaid, states are required to cover certain populations (low-income children under 18, low-income pregnant women, certain welfare recipients, and seniors with disabilities who receive Supplemental Security Income (SSI), but have wide discretion on income eligibility levels. In 2014, Medicaid was expanded under the Affordable Care Act (ACA) to cover every person below 138 percent of the federal poverty line ($33,600 for a family of four in 2017). 31 states and Washington, DC have expanded Medicaid under the ACA.
Medicaid is an “entitlement” program (all who are eligible and enrolled must be covered) and is financed with state and federal money. On average, the federal government covers 57-60 percent of state spending on Medicaid, with poorer states receiving higher amounts. Under the ACA, the federal government covers 100 percent of the expansion costs for the first few years, which then gradually drops to 90 percent.
Estimates are since the ACA went into effect in 2014, Medicaid has helped reduce the uninsured rate in America by 16 million. Medicaid patients are more likely to seek preventative and primary care; in contrast, persons who have lost Medicaid coverage are 2-3 times more likely to not seek care due to cost. Studies show that Medicaid has helped reduce childhood deaths, infant mortality, and low-birth weight in children. Kids who are on Medicaid do better in school, are more likely to graduate, and earn more income as adults.
What Would the AHCA Do?
The House’s American Health Care Act (AHCA), H.R. 1628 would make devastating changes to Medicaid. First, it would “freeze” the ACA’s Medicaid expansion in 2020 so new enrollees could not sign up and then significantly reduce the reimbursement to states. This would cause the expansion to “wither on the vine” and disappear altogether within a few years.
More alarming, the AHCA would radically restructure the traditional Medicaid program. It would change Medicaid’s dedicated, mandatory funding by Congress to a per capita cap, meaning that states would only receive a fixed amount of funding for each enrollee. If states have an increase in enrollment or choose to expand services, they would have to cover 100 percent of the costs.
In March 2017, the Congressional Budget Office estimated that the ACHA would result in $880 billion in Medicaid cuts over ten years and 14 million people would lose Medicaid coverage (a total of 24 million would lose health coverage under the AHCA). States would be forced to cut enrollment, cut services, or both. To add insult to injury, the AHCA’s Medicaid cuts will be used to cuts taxes on wealthy Americans and large corporations under the Affordable Care Act.
The AHCA would be devastating to low-income families across the country. We must do everything we can to see that these changes and cuts to Medicaid are never enacted into law.