How Medicaid brought down TrumpCare

Republican efforts to repeal and replace the Affordable Care Act have failed, largely because their legislation did so much more. In their hubris they sought to also dismantle the traditional Medicaid that predated the law by 45 years, something Speaker Paul Ryan had admitted was a dream since his fraternity kegger days. 

And it was the Medicaid cuts that forced Republicans into their worst public contortions. Some Trump administration officials, like Kellyanne Conway, falsely denied there even were cuts — though their off-message boss had called the cuts “mean, mean, mean.”  Others glossed over them, as Vice President Pence recently did in an incredible guarantee before the National Governors Association that the Senate bill “ensures that every state in America has the resources you need to take care of your most vulnerable.” At that same meeting, a report was shared showing Pence’s own state of Indiana would lose $4.9 billion just by 2026.

{mosads}Pence’s pious prevaricating meant Republicans like Sen. Susan Collins (R-Maine) had to be lonely truth-tellers. As she noted on CNN, “You can’t take more than $700 billion out of the Medicaid program” and fail to acknowledge the impact upon predominantly-Medicaid providers, such as “our rural hospitals and our nursing homes.”

And Medicaid costs are hardly out of control. In 2015, for example, Medicaid spending on nursing home care only went up 1.1 percent. Of that spending, the federal government covered at least 50 percent, and up to 75 percent, of the cost under the current formula in which it matches state contributions based upon how wealthy, or poor, the state’s population is. That matching would have been replaced by a cap per beneficiary under the House and Senate bills. 

According to the last Congressional Budget Office analysis of the failed Senate bill, this ultimately would have reduced Medicaid spending nationally by 35 percent in two decades, even as, by 2030, Census numbers show the population of Americans 85 and older alone will have increased by 3 million from 2012. The impact should be obvious, as that is the age demographic most in need of long-term care. 

One conservative think tank recently promoted Medicaid cuts by making the amazing argument that Medicaid somehow advantages the wealthiest states — noting such states generally put up more money. But is it not central to conservatism to recognize the right of each state to make its own spending decisions? 

If anything, the current Medicaid system acts as a disincentive for wealthier states to spend more. For every dollar New Hampshire spends, for example, it only receives one federal dollar. In contrast, Mississippi has 75 percent of its Medicaid costs paid by the federal government. 

Far from encouraging wealthy states to spend more, this formula encourages poorer states to spend less. In states like Mississippi, for example, federal money flowing in from states like New Hampshire allow governors and legislators to cut taxes while, ironically, denouncing the profligacy of the federal government. Meanwhile, a wealthier state like New Hampshire, tied with other wealthier states for the lowest federal matching rate, has the nation’s third-worst gap between state Medicaid payments and nursing home costs.

Replacing matching funds with per-capita caps upon Medicaid beneficiaries would simply lock in such inequities, falling harder upon states that have historically supported care for the Medicaid poor and allowing a governor like Mississippi’s Phil Bryant to further ration Medicaid while, in an obese and unhealthy state, pursuing noble agenda items such as banning local governments from requiring menu calorie counts. 

And where would those supporting Medicaid cuts suggest they be made up? The federal government openly acknowledges that nursing homes, which nationally had a positive margin of only 1.6 percent in 2015, lose money on Medicaid care even under the current system. With wages comprising three-quarters of costs, this leaves no margin for federal cuts. As Collins noted, facilities “would have a very difficult time even staying in existence and serving vulnerable populations.”

There is a nationwide shortage of caregivers, even before an age wave described as a “silver tsunami.” Most caregivers are women — with 85 percent of those working in nursing homes are women — and many caregivers are single moms pursuing living wage dreams. Turnover is very high, as Medicaid reimbursement depresses wages — workers, providing public assistance themselves, often must rely upon public assistance. These workers need Medicaid reimbursement that supports living wages, not Medicaid cuts that would eliminate both home- and community-based options and force facility closures. We need to prepare for the age wave, not dismantle our long-term care infrastructure.

These truths may not be evident in think tanks, but they informed the decisions of many Republicans, both governors and senators, to oppose cuts that would wreak havoc upon care and state budgets alike. In so doing, they were on the side of the 71 percent of voters who, in one recent poll, oppose federal Medicaid cuts.

The cuts were so unpopular that Senate Majority Leader Mitch McConnell reportedly assured moderates that the cuts would never be implemented. Not only did these assurances not fool moderates, they backfired — becoming the stated reason McConnell lost the vote.

Brendan Williams is the president/CEO of the New Hampshire Health Care Association, which represents 90 long-term care facilities. 

The views expressed by contributors are their own and are not the views of The Hill.