President Donald Trump and his Republican colleagues in the Congress are furiously working to pass some form of health care reform. Since the 2010 passage of the Affordable Care Act, the GOP’s mantra has been “repeal and replace,” and with all three branches of the federal government in their hands, it appears the moment to fulfill their promise has arrived.
In May, the House of Representatives passed the American Health Care Act (AHCA). This initial salvo in the war on the ACA could cause almost 24 million Americans to lose their health insurance while saving almost $337 billion over ten years, according to the Congressional Budget Office. The U.S. Senate is currently in the midst of drafting its own version the Better Health Care Reconciliation Act (BCRA). Both bills would make major cuts to Medicaid which was greatly expanded under President Obama.
While the Senate proposal would cut $772 billion from Medicaid over ten years, the House version would eliminate $834 billion over that period. These drastic changes in the federal insurance program that primarily serves the poor and disabled would be an almost catastrophic disruption for the U.S. health care system. These changes to Medicaid would have far-reaching effects for nursing homes, physical therapy clinics, veterans benefits and community-based services.
One of the key ways that Medicaid will likely adjust to its shrinking budget is to reexamine nursing home expenditure. Although only 6 percent of Medicaid enrollees use nursing facilities, they account for almost 42 percent of Medicaid spending. The AHCA specifically targets nursing home coverage by including home value in program eligibility. In states like New York, Massachusetts and California, where real estate prices are high, that would strip thousands of elderly and disabled of Medicaid eligibility.
With nearly 74 million enrollees, or almost one-fifth of the U.S. population, Medicaid is an important pillar of the U.S. health care sector. A new report from George Washington University projects that if the Congressional bills are passed, the health care sector would lose almost a million jobs, and business output would be reduced by $148 billion through 2026. There is an increasingly popular theory that these reforms could usher in a new recession, especially in states with large numbers of low-income residents that enrolled during the Medicaid expansion.
Although it is difficult to predict if the new House or Senate bills will be ratified, the general consensus among commentators and political insiders is that it is unlikely. With only a slim majority in the Senate, and two Senators—Susan Collins and Rand Paul—already firm ‘no’s, the Republican caucus cannot afford to lose any other members to pass the bill. The Congressional Budget Office is preparing to release a new score on the revised version of the Better Health Care Reconciliation Act in the days ahead, and if it projects that a substantial number of Americans will lose coverage or that premiums will jump, then more Senators will likely abandon the effort.
Article written by:
Dr. Robert Moghim - CEO Onyx M.D.
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