Proposed Medicaid Bill Details Are “Really Extreme,” Says Health Plan Leader

The Medicaid plan proposed by the Republican chair of the House Energy and Commerce Committee this week has stirred up controversy within Congress and even within the Republican party.

The plan unveiled Sunday night by Rep. Brett Guthrie, a Kentucky Republican, is just one part of the massive tax and spending reconciliation bill that Republicans hope to maneuver through the House and Senate and have ready for President Donald Trump to sign by July 4.

Guthrie's plan calls for implementation of work requirements and tighter eligibility rules for the approximately 80 million Americans currently covered by Medicaid, which is jointly funded by the federal government and individual states.

In a preliminary assessment, the nonpartisan Congressional Budget Office estimated that the Republican changes would cut federal government spending by $715 billion over 10 years but also increase the number of people in the U.S. without health insurance by 13.7 million.

In an interview today with Managed Healthcare Executive, Leanne Berge, J.D., CEO of Community Health Plan of Washington in Seattle and chair of the Association of Community Affiliated Plans board of directors, discussed the potential fallout from what the Republicans are proposing. Berge says the Republican plans will do more harm than good for Medicaid enrollees and healthcare in the U.S. overall.  Community Health Plan is a not-for-profit health plan that has nearly 350,000 members, 290,000 of whom are covered by Medicaid.

This Q&A has been edited for length and clarity.

Leanne Berge

Isn’t this bill milder compared with what more conservative Republicans were pushing for?

I think on the surface it seemed that way, but the independent Congressional Budget Office has said that it could be the equivalent of a loss of almost 14 million currently insured individuals.

[The bill] has a variety of different provisions that I think are not well understood by people, as opposed to the more direct cuts like the per capita caps on Medicaid, where it was more obvious what the impact would be.

This is a little bit less clear to people because of the multiple provisions that are included here and how tightening eligibility requirements impacts people.

Let's talk about work requirements and how they’re highlighted in the bill. Theoretically, aren’t work requirements a good thing?

Theoretically, work requirements are a good thing, because we want people to be motivated to work and not to take advantage of this system. Ninety-two percent of people in this category that work requirements would apply to already work. So, you'd say, ‘Okay, what's the big deal? You're not going to lose coverage.’

The reality is that people in very low-income jobs may already have work, but it's sporadic, so they need Medicaid to continue to stay healthy and to stay employed.

It is difficult in the states that have tried to have work requirements as a condition for eligibility because it’s been very hard for the individuals themselves to successfully report on their work. Instead, you're losing eligibility because you can't report in a timely manner.

In this proposed bill, there are work requirement provisions for twice-a-year reporting and eligibility checks. That makes it particularly hard for people to meet those reporting requirements and not lose coverage.

The other piece of it is that in a time of higher unemployment, it's harder to ensure that people will be working.

Trump has said that he would not cut Medicaid funding, but instead, he's tackling “waste, fraud and abuse.” In theory, isn’t that also a good thing?

In theory, getting rid of waste and fraud is always a good thing, and there's always some amount of waste and fraud in any system. The reality, however, is that this is setting up for tremendous administrative waste and administrative red tape. This is not a good use of taxpayers’ money, and instead of ensuring that the people who are eligible for coverage receive coverage, you're taking eligible people off Medicaid coverage because of these hoops that they must jump through. If you look more specifically at the provisions, it goes way beyond any type of potential fraud and abuse.

There are many guidelines already in place to ensure that there's very limited fraud and abuse, both at the ACA coverage under the exchange as well as Medicaid.

The ACA exchange coverage is also severely harmed by this bill. It's not just the Medicaid populations. Those folks that are seeking care under the exchange will now make it much harder for them to receive coverage as well.

It's especially important for people to understand that the expansion population are people that need health care and need coverage and that are working today. By targeting what they call “able-bodied people,” you're targeting your neighbors, your family members, and people who are doing all they can to keep their head above water, pay their bills, work and take care of their families. Those individuals are going to be harmed directly by this legislation. Not only will they be harmed, but everybody who's dependent on Medicaid will also be harmed because of the cuts that are so extensive under this bill. We all hope that the moderates will push back and that this bill will look very different by the time it gets to the point of the House vote.

If this bill does pass, what are some ways that it could impact Community Health Plan of Washington members?

The state of Washington is in a similar position as a lot of other states in terms of the loss of funding that would happen under the provisions of this bill. There are several different ways that funding would be cut, and the state won’t have the capacity to make up for that funding. We're talking about increasing the uninsured by a significant percentage. I think when you look at the numbers, it's close to a 20% increase in uninsured over the course of 10 years.

For the health plan, we would be expecting to see a loss of membership. Even more significant would be the harm to the healthcare delivery system and members.

The delivery system would be harmed because of the increases in uninsured, which would impact community health centers because 50% of their population are on Medicaid. That is essential reimbursement to cover the rest of their patient population and to keep their doors open.

Community health centers are responsible for serving all patients, whether they have insurance or not, and by increasing the levels of uninsured, it would really put a major dent in the finances of the community health centers.

The other impact would be on hospitals and other providers, who would have to increase their services for the uninsured, which they don't have the financial wherewithal to do. It would mean that premiums go up for everybody else that has commercial insurance.

Ultimately, it doesn't just harm the individuals that might be immediately targeted under this legislation; it would harm everyone who has any contact with the healthcare system. It would put the healthcare system itself in a precarious position.