The Medicaid changes reportedly being discussed in secret by Republican senators has motivated ten of the country’s biggest health care plans to send a letter asking the senators to carefully consider what the hell they are doing.
The full text of the letter can be found here: Joint Medicaid MCO Senate Letter
The undersigned Managed Care Organizations represent nearly 13.5 million of our fellow citizens in 23 states across the country who rely on Medicaid for their health and well-being. We respectfully ask you to carefully consider the ramifications and consequences of altering the Medicaid related provisions of the Affordable Care Act (ACA) and the underlying financing structure of the Medicaid program so that reforms assure coverage to existing and future eligible enrollees while bending the cost curve through value-based initiatives. This year’s discussion began with a focus on the ACA’s individual insurance market, but current health care proposals go further and do not enact meaningful, needed repairs to the ACA. However, our primary concerns lie in the impacts these policies will have on the 74 million low-income, disabled and elderly Americans whose health care coverage through Medicaid rests in the hands of the Senate as you craft new legislation and policy options.
The providers specifically single out the fallacious arguments for state level flexibilities.
While this may appear positive from an immediate budgetary perspective, these amounts spell deep cuts, not state flexibilities, in Medicaid. There are no hidden efficiencies that states can use to address gaps of this magnitude without harming beneficiaries or imposing undue burden to our health care system and all U.S. taxpayers. Reducing the federal government’s share of Medicaid in this manner is not meaningful reform to bend the cost curve. It is simply an enormous cost shift to the states. It does nothing to address underlying drivers of the cost of care, like expensive new drugs and therapies, and an aging population living longer with disability. States are already hard-pressed to meet these challenges while balancing their budgets.
Simply put, the projected shortfall in federal funding must be addressed by each state, forcing them to make difficult choices which may include: 1) making up the difference through increased state and local taxes; 2) reducing benefits; 3) cutting reimbursement to health care providers; and 4) eliminating coverage for certain categories of currently eligible beneficiaries. Unlike previous shortterm changes, policies under consideration make the reductions permanent and penalize states that have already achieved efficiencies and lowered their historical spending trend.
When it comes down to it, the GOP is ignoring the health care establishment, the insurance industry, and the loss of access to health care that will be inevitable for 23 million Americans and up, all to pass massive tax breaks for the super rich. That is the sum total of what the current legislation is all about. It does nothing to reduce costs. It does everything to deny health care access to the middle class and poor.
As one retired economist explained, putting this in real numbers in a thread attached to an article discussing Andy Slavitt, the former acting Administrator of the Centers for Medicare and Medicaid Services, and his assertion that:
“I spent a better part of the day in the Senate yesterday, and as near as I can tell, the best way I can describe it, is we’re going to get something like a Frankenstein monster of health care,” he said. “This is going to be something that very few can love. It’s going to end Medicaid as we know it, the question is only how quickly. And in order to get a better score from the [Congressional Budget Office], they’re going to make the tax credits look more like Obamacare tax credits, only without any money to do it.”
All this just so some very, very rich people can get richer at an even faster rate (lower taxes). The bill eliminates the 0.9% ACA tax on ordinary income above the first $250,000 earned and the 3.8% ACA tax on investment income above the first $250,000.
Someone earning $500,000 of ordinary income would only save $2,250 in taxes but the Walton heirs, if earning about a 3% return on their $180 billion in wealth ($5.4 billion per year), would save over $200 million per year in taxes.