Health Law

ABA opposes health reform bill, warns of burden shift to states that could lead to rationed care

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The ABA on Monday expressed opposition to a Senate bill to partly repeal and replace the Affordable Care Act in a letter that focuses on the impact on Medicaid coverage.

The four-page letter calls Medicaid “a lifeline” that serves “our nation’s most vulnerable populations.” It was signed by Thomas Susman, director of the ABA Governmental Affairs Office, and addressed to the chairman and ranking member of the Senate Finance Committee.

According to the letter, the Senate proposals are expected to increase the number of uninsured Americans and cause health care costs to rise. Among those who would be impacted are seniors who spend down their assets before turning to Medicaid for long-term care, and children with disabilities who rely on Medicaid coverage for access to services.

The letter opposes converting federal funding for Medicaid into block grants for states and opposes per capita caps on federal contributions, which are based on a fixed formula. The formula fails to reflect differing needs among states and the growth in long-term care costs, the letter says, adding that financially strapped states could ration Medicaid care.

“While a per capita cap structure would make it easy for the federal government to dial down Medicaid growth rates to achieve savings, this in turn will shift added burdens onto the states,” the letter states. “There is no reason to believe that currently proposed growth rates in spending would remain stable. This burden shift will therefore likely lead states to ration care by reducing services and provider payments.”

States struggling to pay for Medicaid would be likely to cut home-based and community-based services that enable older Americans and those with disabilities to remain in their homes, the letter says.

The bill is sponsored by Republican Senators Lindsey Graham, Bill Cassidy, Dean Heller and Ron Johnson. The New York Times, the Health Affairs Blog and the Washington Post summarize the provisions. The bill eliminates both the health insurance mandate for individuals and employers. It repeals both expansion of Medicaid and tax credits to help people buy insurance on the individual market. Those measures would be replaced with the block grant program.

States could use the block grants to replicate Affordable Care Act programs or to substitute for existing state spending, according to the New York Times. States also could waive mandated health benefits, and states would be allowed to get waivers allowing insurers to charge higher prices for people with pre-existing conditions.

The letter urges strong support for Medicaid in any Senate legislation addressing health care reform. “… We strongly oppose structural or financial changes in the Medicaid program that would weaken the current entitlement nature of the program or the shared legal obligation that the federal and state governments have to provide comprehensive benefits to all individuals who meet eligibility criteria,” the letter says.

Typo correctd on Sept. 26.

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