The U.S. House of Representatives withdrew the American Health Care Act before a full floor vote late today. It’s not clear what’s next for the bill to repeal and replace the Affordable Care Act as Republican leaders can’t find enough support within their caucus to pass it as it is. The latest version would dramatically restructure the Medicaid program, shift costs and financial risk to states and result in millions of Americans losing health coverage, according to an estimate last week from the non-partisan Congressional Budget Office. In addition to components of the original proposal that will negatively impact kids and families as well as the Colorado budget, an amendment to the proposal introduced this week, as well as ongoing negotiations in the U.S. House, have even more concerning implications.
A new report out this week from the Urban Institute analyzes the financial impact on each state of the Medicaid per capita cap in the American Health Care Act proposal. According to the report, under the proposal, Colorado would see a reduction of about $15 billion, or about 20 percent, in federal funding for Medicaid over 10 years. In order for Colorado to close that gap in federal funding and avoid cuts to the Medicaid program, the state would have to increase the amount of state Medicaid spending by more than 33 percent.
In addition to the proposal to cap the entire Medicaid program, the amendment would give states the option to choose a block grant for certain groups of Medicaid enrollees, including parents, pregnant women, and children, as an alternative to the per capita cap. Under the block grant, states would not be required to cover Early and Periodic Screening, Diagnostic and Treatment (EPSDT) benefits for children, which are recognized as the standard for children’s care and include a broad array of screening, preventive and treatment services that improve the health of kids. States would not be required to maintain cost-sharing protections, could impose enrollment freezes and caps, and could narrow Medicaid provider networks, all of which would negatively impact children and families.
In addition, under the block grant option, states would not be required to maintain coverage for parents, so states could reduce or eliminate parent eligibility. Children’s health and well-being depends on the health and financial security of their parents, and health insurance coverage improves parents’ health status, access to care and financial security. Providing access to health coverage for parents also increases the number of kids who are covered.
A block grant would further shift costs and financial risk to states. Funding to states under the block grant would not adjust for population growth or respond to a recession. It would only increase by the growth in the consumer price index (CPI) each year, which is a slower rate than growth in the price of medical care. Both the per capita cap and block grant proposals would dismantle Medicaid’s flexible financing structure that has protected children, families, individuals with disabilities and seniors for more than 50 years, during economic downturns or when Colorado faced increased health care costs due to natural disasters like floods and wildfires.
The latest negotiations in the U.S. House involve eliminating the Essential Health Benefits (EHB) package in the Affordable Care Act, which ensures that private health insurance plans include 10 categories of benefits, like preventive care, maternity and newborn care, and pediatric services, that are critical for children’s healthy development as well as for supporting the health of their parents. Furthermore, without EHBs, protections for individuals with preexisting conditions and prohibitions on annual or lifetime limits on coverage are meaningless. Plans will no longer have to cover the services that people with preexisting conditions need, and the prohibition on annual or lifetime limits in the Affordable Care Act only applies to EHBs.
The impact of the American Health Care Act proposal on children and families, and the Colorado state budget, continues to worsen. Please call your U.S. Representative and urge a NO vote on this harmful legislation.