TAKE ACTION: New GOP Bill Imperils Health Care/Medicaid

Updated March 14, 2017

On March 13, the Congressional Budget Office (CBO)—a nonpartisan agency that provides objective budget and economic information to Congress—released its “score” of the effects of the American Health Care Act (AHCA).  The CBO projects that if this bill is enacted, 14 million more people in the U.S. will be uninsured in 2018, and by 2026, 24 million more people will be uninsured than under current law.  The CBO estimates that the AHCA will slash the federal contribution to Medicaid by $880 billion over 10 years.  The House, which has already moved the bill forward without the CBO score, is continuing full steam ahead to pass it with almost no debate. Congressional leaders hope to have final votes as soon as next week. 

Now is the time to call your members of Congress, both House and Senate, at (202) 224-3121 and tell them to reject the American Health Care Act.

The AHCA would make sweeping changes to the health care system by eliminating the need-based health care subsidies at the heart of the Affordable Care Act (ACA) and making dramatic cuts to Medicaid. This is the much-anticipated ACA Repeal bill promised for years by Republicans.

The bill would shift an estimated $880 billion in Medicaid costs to the states over the next 10 years, effectively ending the Medicaid expansion starting in 2020 while also harming the care for tens of millions of children, parents, people with disabilities, and seniors who rely on the program today.  The CBO estimates that by 2026, 14 million fewer people would receive Medicaid coverage than under current law.

The AHCA fundamentally changes the core funding structure of Medicaid as it has existed for 50 years. Instead of the ongoing federal commitment to sharing in the costs of providing comprehensive coverage to eligible families, states would receive capped funding—or “per capita caps”—for Medicaid. This does nothing to reduce the cost of health insurance; it only shifts costs from the federal government to states, forcing them to make the hard choices of raising taxes, or cutting eligibility, benefits, or provider payments. This is exactly what happened in other block grant programs. The capped funding structure of both the Temporary Assistance for Needy Families (TANF) program and the Child Care and Development Block Grant (CCDBG) has failed to keep up with need, requiring states to restrict access and cut payments to families and providers. With Medicaid per capita caps, states would have no choice but to reduce enrollment, cut benefits, or shift additional costs to providers. This puts at risk the coverage of millions of children, parents, seniors, and people with disabilities who rely on Medicaid for their health and wellbeing.

Other provisions of this bill would make it more difficult for individuals to apply for Medicaid and to maintain their coverage. In addition, AHCA undermines the quality of the benefit available to people receiving Medicaid, meaning that medically necessary services may not be covered and, thus, unavailable unless people can afford to pay out-of-pocket for care.

AHCA would also undermine access to affordable health insurance for millions of moderate-income people who currently purchase insurance through the ACA’s marketplace with help from federal premium tax credits. Because the new credits proposed by AHCA would be delinked from both the true cost of insurance and the customer’s ability to pay, millions of people would find health insurance unaffordable, even with the credits. Moreover, this would create a new work disincentive (a so-called “cliff effect”) for individuals whose earnings exceeded the Medicaid eligibility thresholds – meaning that low-income working parents would once again be forced to turn down added hours or a promotion at work to avoid jeopardizing their and their family’s health care. That’s a choice no one should be asked to make.

CLASP has raised serious concerns about this proposal to the House, urging them to immediately reject this bill and halt its legislative progress. If enacted, this bill will be devastating to: children, parents, seniors, and people with disabilities who get their coverage through Medicaid, low-income workers whether covered by the Medicaid expansion or by ACA premium tax credits, and states that will likely have to cut other key investments such as education to cover growing health care costs.

Together we must draw a line in the sand and demand our representatives stand up to protect the health and economic security of their constituents. They should not enact any health care bill that cuts Medicaid and leaves more people uninsured.