Some kind of reform is necessary, health insurers say, but the deep cuts currently proposed for Medicaid would leave states struggling to care for poor residents.
Saying Medicaid reform is necessary, but not in the way it has been suggested recently in Congress, the leaders of 10 health insurance plans have issued a joint letter to all 100 Senators and key committee members urging them to reconsider proposed Medicaid provisions and their potential impact.
The health plans cover nearly 13.5 million consumers in 23 states across the country.
The letter asks Senators and other influential leaders to carefully consider the consequences of altering Medicaid. It is signed by the CEOs and presidents of AmeriHealth Caritas, Blue Shield of California, CalOptima, CareSource, Gateway Health Plan, Healthfirst (NY), Inland Empire Health Plan, LA Care Health Plan, Molina Healthcare, and UMPC for You.
They say the Affordable Care Act and the underlying financing structure of the Medicaid program should be modified in ways that promote overall savings in the system, rather than cutting funding to states.
"This year's discussion began with a focus on the ACA's individual insurance market, but current healthcare proposals go further and do not enact meaningful, needed repairs to the ACA," the letter says.
"However, our primary concerns lie in the impacts these policies will have on the 74 million low-income, disabled and elderly Americans whose healthcare coverage through Medicaid rests in the hands of the Senate as you craft new legislation and policy options."
Rather than the funding cuts under consideration, the letter urges Senators to include other options to preserve access to care, such as:
- Regulatory simplification to increase efficiency
- Continued expansion of waiver flexibility for states
- Value-based pricing
- Regulatory relief to determine prescription drug formularies and improved prescription drug price transparency
- Alternative payments for healthcare providers based on population management instead of piece work reimbursement
- Flexibility to use Medicaid funds to address social determinants of health
- Consolidation of administration and benefit design of those eligible for both Medicaid and Medicare, the dual-eligibles who make up the most costly segment of Medicaid
The health plan leaders state that they are united in opposition to the Medicaid policies currently debated by the Senate, but not to the idea of reform.
"We are not advocating to maintain the status quo; rather we are advocating for meaningful Medicaid reform," the letter says.
The letter notes that under the policies being considered in Congress, the federal government would establish a limit on the amount of funding it would provide to states each year beginning in 2020, and instead of actuarial computations the government would use 2016 Medicaid costs
trended forward by the Medical Consumer Price Index.
That approach is estimated to reduce the federal share of Medicaid funding by more than $800 billion over 10 years, amounting to a 25% shortfall in covering the actual cost of Medicaid.
"While this may appear positive from an immediate budgetary perspective, these amounts spell deep cuts, not state flexibilities, in Medicaid. There are no hidden efficiencies that states can use to address gaps of this magnitude without harming beneficiaries or imposing undue burden to
our health care system and all U.S. taxpayers," the letter says.
"Reducing the federal government's share of Medicaid in this manner is not meaningful reform to bend the cost curve. It is simply an enormous cost shift to the states. It does nothing to address underlying drivers of the cost of care, like expensive new drugs and therapies, and an aging population living longer with disability."
States would have to cope with the budget shortfall with strategies such as increased state
and local taxes, reducing benefits, cutting reimbursement to healthcare providers, and
eliminating coverage for certain categories of currently eligible beneficiaries, the letter says.
June 20, 2017 Letter to Senate by HLMedit on Scribd
Gregory A. Freeman is a contributing writer for HealthLeaders.