Trump Picks For HHS Signal Radical Restructuring of Medicaid Contemplated with Coverage for Millions of Children and Families at Risk

Sad Son Hugging His Mother

Today we have learned of President-Elect Trump’s choices for the two most important health care policymakers in his Administration. They will have broad authority to shape the future of Medicare and Medicaid. Current House Budget Committee Chair Tom Price (R-GA) has been nominated to serve as the Secretary of Health and Human Services and Seema Verma, a health policy consultant who was the architect of Vice President-Elect Pence’s Medicaid waiver, has been named to head the Centers for Medicare and Medicaid Services (CMS).

As best as I can recall, this is the first time that a CMS Administrator comes to the job with experience primarily working on Medicaid (as opposed to Medicare).  This signals that we can expect very radical and, in my view, dangerous changes to be proposed to the Medicaid program. As my colleague Edwin Park has blogged about, Congressman Price’s budget, which passed the House earlier this year, repealed the Medicaid expansion, block-granted Medicaid and would result in a total cut to Medicaid of $2.1 trillion over ten years. That’s a reduction of one-third for the current program. CHIP was rolled into the block grant with Medicaid.

Other recent proposals in the House have proposed to apply a per capita cap to Medicaid – we will follow up on the differences between the two approaches to restructure Medicaid, but both would fundamentally change the way Medicaid operates today especially in light of the enormous cuts that are contemplated.

As regular readers of SayAhhh! know, we have closely followed the Indiana Medicaid waiver (here’s my blog from the day when that waiver was approved) and more recently the pending Kentucky waiver (you can see comments on that waiver here) which Ms. Verma was involved in developing. At the time that the Indiana waiver was approved, I noted that it was good news that Governor Pence and the Obama Administration had agreed to move forward to offer coverage to up to an estimated 350,000.

What it is important to remember though is that Indiana’s approach (and Kentucky’s pending waiver) were formulated in an environment where Governors had to negotiate with an Obama Administration mitigating some of the more extreme elements that would have harmed consumers. What can we infer from the experience with the Indiana and Kentucky waivers about where this Administration would go?

  • Caps on enrollment – Healthy Indiana had one before the ACA passed.
  • Overly punitive barriers to coverage such as a twelve-month lock-out if Medicaid consumers miss a deadline on their paperwork (even if it got lost in the mail!) or a premium payment. These kinds of policies make for bad health policy decisions that force people to remain uninsured and unable to get preventive care so they wind up sicker and in need of more expensive care.
  • Work requirements – in my view a red-tape barrier that doesn’t reflect reality that most Medicaid beneficiaries already work if they can and likely need health care to help them work (not the other way around).
  • Cost-shifting to families and states – more cost-sharing and premiums would create barriers to needed care and cuts to Medicaid funding would wreak havoc on state budgets.

My colleague Elisabeth Burak blogged last week about our many concerns about a Medicaid block grant. The latest block-granting plan proposes a radical restructuring and deep cuts to the backbone of our nation’s public coverage system and would result in tens of millions of people losing coverage. Children are the largest group of Medicaid beneficiaries constituting just under half of those enrolled. Parents and other adults, persons with disabilities, and seniors receiving long term care are all served by the Medicaid program. Their health care needs will not go away even if Medicaid’s capacity to respond to them is undermined. Those who are concerned about the health and well-being of Americans who rely on Medicaid and Medicare should brace themselves for tumultuous times ahead.

Joan Alker
Joan Alker is the Executive Director of the Center for Children and Families and a Research Professor at the Georgetown McCourt School of Public Policy

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