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By Anne Dunkelberg
This week I joined CPPP Senior Policy Analyst Stacey Pogue for a Facebook Live discussion about what Congressional health care proposals might mean for Texas.
You can watch a recording of the discussion here.
Overall: The most distressing part of the Congressional plan is that it doesn’t provide a pathway to reach the remaining 4.6 million uninsured Texans, and instead would likely increase that number and erase the coverage gains of the last several years.
Some of the other key takeaways from our early analysis of the health care proposal coming out of Congress include the following:
Marketplace and Individual Market Insurance
• This proposal makes private coverage unaffordable for millions of Americans. Premiums will rise for many people getting affordable coverage today in the Health Insurance Marketplace, and out-of-pocket costs like deductibles will go up, too.
• The plan would replace the ACA’s sliding scale tax credits (which adjust for income, age, and cost of insurance where you live) with a less generous, essentially flat tax credit (that adjusts only for age). This means there would be clear winners and losers. People hit the hardest are lower income, older (ages 50-64), and people who live in rural areas, where the underlying cost of health insurance is higher. Note that about 900,000 Texans get a tax credit under the ACA.
• There are some provisions in the plan that just don’t make sense. A family of four who makes $100,000 per year, under this new plan, would get the same subsidy / tax credit as a family that makes $30,000 per year.
• Premiums would also rise under this bill because there is much less incentive for younger and healthier people to get coverage. Today, there is a penalty that encourages people to get insurance. Eliminating this provision changes who is covered. More sick people keeping coverage, and more healthy people dropping it would mean raising premiums for everyone.
Medicaid
• In Medicaid, starting in 2020, the plan would cap the overall federal funding available to Texas, preventing necessary increases to allow Texas to add life-saving innovations, bring up seriously inadequate payments to care providers, or fill current gaps in basic health care services.
• In other words, the plan would make it really hard to improve anything that we are not doing well today. For example, Texas hasn’t given doctors regular pay increases under Medicaid since 1993, and there would be no space under a “cap” to improve that.
• There are also over 200,000 Texans on waiting lists for Community Care programs, and they wouldn’t have a way to get off those lists if Congress caps Medicaid funding.
Stay tuned for more updates from CPPP as the health care debates in Washington and Austin continue.
As CPPP’s Stacey Pogue recently explained, U.S. House leaders are expected to file legislation within days that will begin to repeal and “replace” the Affordable Care Act (“ACA” or Obamacare). Based on an outline made public in February, the bill is expected to result in fewer people being able to afford insurance—especially low- and moderate-income individuals—and in allowing insurance plans to cover fewer benefits.
Beyond cutting affordability and consumer protections for private health insurance coverage, the U.S. House outline also proposed a radical restructuring of Medicaid. Based on the outline, a leaked bill draft that was analyzed by many experts, and the actual bills filed and officially “scored” last summer (2016), last summer’s House bill did not just “bend the cost curve”—like dropping the growth in per-enrollee cost from six percent to three percent a year—but actually cut federal Medicaid funds to Texas below current levels by as much as 25 percent. So, the very first question we will ask when an actual bill is finally filed will be, “does it cut Texas Medicaid funds below current levels, which would force cuts to eligibility, benefits, or provider pay? And, by how much?”
Another critical point is that last summer’s bill would have cut Texas Medicaid by roughly $4.8 billion (20 percent of federal Medicaid dollars to Texas in 2016) in the second year of that law, regardless of whether Texas chose a Block Grant or a Per Capita Cap (also known as per beneficiary allotment). In other words, no matter what went into the complex formula for a state Medicaid block grant or per capita cap, Congress still planned to cut Medicaid funding to all the states below the base year! There is a big difference between “bending the curve” and this enormous cost shift from the federal budget to the state.
To give you a frame of reference, a $4.8 billion cut in federal Medicaid funds would be 48 times larger than the $150 million state dollar 2015 Medicaid Pediatric Therapy Cuts, and four to five times the size of even the massive 2003 Medicaid cuts (the $500 million federal funds annually then was just under 5% of total federal Medicaid funding for 2004).
Texas has many additional worries in a federal Medicaid cut-back, including whether we can keep our 1115 waiver dollars and other funds for hospitals; whether we will be locked in forever to physician and other health professional fees that have not had regular updates for over 20 years; whether we will forfeit an estimated $6 to $8 billion a year in Medicaid Expansion funding that 31 other states have received; and whether we can ever get federal dollars for our remaining uninsured or for over 200,000 Texans with disabilities on waiting lists for community care.
For a full check-list of all the issues and concerns for Texas Medicaid, see this new CPPP guide to understanding Medicaid Block Grant and Per Capita Cap proposals and how they could impact (and damage) Texans’ access to health care. Then follow along with our CPPP team as we analysis the next Congressional proposals as they become official. Then we can all work together to make sure all our elected officials in Austin and Washington know exactly what is at stake for Texas.
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