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Graham, Trump discuss alternate ObamaCare repeal bill

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Graham, Trump discuss alternate ObamaCare repeal bill

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Sen. Lindsey Graham (R-S.C.) met with President Trump Friday at the White House about the senator’s ObamaCare replacement proposal.

The meeting comes as some Republicans are pushing to keep alive their effort to repeal and replace ObamaCare despite the failed vote in the Senate early Friday morning.

Graham has pitched his bill as a better alternative to ObamaCare than GOP leaders’ plans. His measure, also backed by Sen. Bill Cassidy (R-La.), would convert money currently being spent on providing ObamaCare coverage into a block grant to states. States could then choose how to spend the funds.

“I had a great meeting with the President and know he remains fully committed to repealing and replacing Obamacare,” Graham said in a statement Friday afternoon.

“President Trump was optimistic about the Graham-Cassidy-Heller proposal. I will continue to work with President Trump and his team to move the idea forward.”

Graham has also spoken with House Freedom Caucus Chairman Mark Meadows (R-N.C.) about the idea, Graham spokesman Kevin Bishop said.

Meadows is also pushing to keep alive the repeal effort and said he had been talking to multiple senators.

“I just think that we’ve got to regroup and continue to stay involved and find something that has 51 votes in the Senate that we can make work,” Meadows told reporters Friday.

Continued efforts to replace the healthcare law face a steep path, though. Senate Majority Leader Mitch McConnell (R-Ky.) said after the failed vote early Friday on a slimmed-down repeal bill that “it is time to move on.”

Republicans have been unable to find 51 votes to pass a plan through the Senate. Other Republicans have started talking about a bipartisan approach.

Graham has expressed hope that Democrats could sign on to his proposal, but so far none have.

Liberal experts have criticized his plan. The Center on Budget and Policy Priorities wrote that the proposal would lead to “drastic cuts” in both Medicaid and subsidies for private insurance, because the amount of the block grants to states would be below ObamaCare spending levels.

How Many People Across America Are at Risk of Losing Their Health Insurance?

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Between 2010 and 2015, more than 19 million people in the United States gained health insurance, mostly through key provisions under the Affordable Care Act, according to an analysis by the Urban Institute.

Many of the newly insured were not poor enough to qualify for Medicaid but too poor to buy their own coverage. Others were shut out because of pre-existing conditions.

These groups and others make up the millions that the Congressional Budget Office says could lose their coverage under the Republican plans to repeal and possibly replace the Affordable Care Act.

“All of the elements that enabled more people to get insurance under Obamacare — protections for pre-existing conditions, the expansion of Medicaid and subsidies to make insurance more affordable — are potentially at risk under the various options the Senate is debating,” said Larry Levitt, a policy expert at the Kaiser Family Foundation.

Under six Republican proposals that the Congressional Budget Office had analyzed, the number of uninsured in America would increase by 22 million to 32 million people in 10 years — essentially erasing much of the gains made under the Affordable Care Act. A C.B.O. analysis released Wednesday night showed that a “skinny” repeal measurebeing floated by lawmakers would increase the number by 16 million in 10 years.

“It’s a dramatic understatement to say there’s uncertainty about where this debate will end up,” Mr. Levitt said.

Would your plan cover John McCain’s treatment?

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https://www.healthinsurance.org/blog/2017/07/25/would-your-plan-cover-john-mccains-treatment/

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The Arizona Senator’s health plan will ensure top-notch glioblastoma treatment, but how would Americans with other health coverage fare?

Last week, we heard the sad news that Senator John McCain has been diagnosed with glioblastoma. McCain had surgery at Phoenix’s Mayo Clinic in mid-July, and it’s expected that he’ll also receive chemotherapy and radiation, along with other potential treatments. Senator McCain has proven time and again that he’s tough as nails, and appears to be facing this latest battle head-on. One thing that he likely has on his side is top-notch health insurance.

McCain is 80, which means he’s presumably been on Medicare for 15 years. Currently serving federal lawmakers are able to obtain employer-subsidized coverage in the Washington DC small-business exchange, and they can have this coverage in addition to Medicare.

How good is McCain’s coverage?

McCain hasn’t said publicly exactly what insurance he has, and his office has not responded to my inquiry. But the most likely scenario is that he has Medicare plus employer-sponsored coverage through the DC exchange – a very comprehensive benefits package.

There are certainly lots of other people who have similar coverage arrangements – either because they’re still working after turning 65, like McCain, or because they receive generous retiree health benefits that supplement their Medicare coverage. For those who don’t, there are private Medicare supplements available that cover virtually all of the out-of-pocket costs associated with Medicare.

But health coverage in the United States is a bit of a mixed bag, with some people having much better coverage than others. A serious illness tends to shine a spotlight on the flaws that exist in some health plans, so let’s take a look at how the average American facing a glioblastoma diagnosis would fare under various health plans.

Employer-sponsored health insurance

Most employer-sponsored health insurance plans provide pretty solid health coverage. According to a 2016 Kaiser Family Foundation analysis, the average deductible for covered workers was about $1,500, and that doesn’t count the 17 percent of covered workers whose plans had no deductible at all.

In addition, the average employer paid more than two-thirds of the total premiums. And the tax exclusion of employer-sponsored insurance premiums amounts to a subsidy that cost the federal government $250 billion in fiscal year 2016.

However, employer-sponsored health insurance is, by definition, linked to employment. A person going through a serious illness like glioblastoma might not be able to continue working, depending on the specifics of the treatment.

As long as the employer has at least 20 employees, the employee will be able to continue the coverage under COBRA for 18 months, even if he or she is unable to work. But COBRA is expensive, as the employer contribution to the premiums and the tax exclusion of the premiums are eliminated. (COBRA premiums are counted as a medical expense for the purpose of itemized medical deductions, but only expenses that exceed 10 percent of your income can be deducted this way.)

Although most employer-sponsored plans provide good coverage, that’s due in part to the ACA. It was not uncommon – particularly in low-wage, high turnover industries – for employers to offer “mini-meds” before the ACA, with exceedingly low benefit caps. (The ACA’s ban on lifetime and annual benefit limits means that these plans are no longer offered to employees.)

A mini-med with a $2,000 or $5,000 annual benefit maximum would not have done much in the face of glioblastoma. Vox reported that just the initial craniotomy to remove a blood clot above Senator McCain’s eye would likely have been billed at more than $76,000. And that was before the cancer diagnosis.

ACA-compliant individual market coverage

The pre-ACA individual market included plenty of solid plans. But dubious coverage also abounded, and regulations varied considerably from one state to another.

The ACA imposed a bevy of regulations on the individual health insurance market, bringing all new (as of 2014) plans up at least a basic minimum standard. Individual major medical coverage can no longer be sold without the ACA’s essential health benefits.

And for those benefits, insurers cannot limit how much they’ll pay during a year or over the course of an insured’s lifetime. (Sadly, another Arizona resident with cancer, Arijit Guha, died in 2013 at age 32. Guha’s health insurance plan had a $300,000 lifetime cap – which is no longer allowed, thanks to the ACA – and his treatment, including chemotherapy that cost $11,000 per session, quickly exceeded that limit.)

Individual-market plans also cannot discriminate against people with pre-existing conditions, either by charging them higher prices or declining their applications (both of those were standard practice in nearly every state prior to 2014). Notably, Senator McCain has a history of melanoma, which would have virtually guaranteed a declined application in the individual market pre-ACA if he had been in need of non-group coverage for some reason.

A person with ACA-compliant individual market coverage would have solid coverage for glioblastoma. The maximum out-of-pocket costs during 2017 would be $7,150, although most plans have out-of-pocket maximums below that threshold. And 57 percent of people who enrolled through the exchanges in 2017 have cost-sharing subsidies, which further reduce the out-of-pocket costs.

The American Cancer Society explains in more detail how the ACA improves access to care for people with cancer. But the short story is that a person facing glioblastoma with a 2017 individual health insurance policy has a much more secure financial safety net than someone with the same diagnosis a decade ago.

Medicaid

Medicaid provides comprehensive coverage. Although the benefits available under traditional Medicaid vary from one state to another, Medicaid expansion coverage is required to include the ACA’s essential health benefits. (The Senate’s Better Care Reconciliation Act – BCRA – would eliminate this requirement after 2019.)

Medicaid has minimal cost-sharing, limited to no more than 5 percent of a family’s annual income.

It’s true that compared with private health insurance and Medicare, fewer medical providers accept Medicaid. But the majority do work with Medicaid. (According to a Kaiser Family Foundation analysis, about 69 percent of office-based physicians accept new Medicaid patients, while about 85 percent accept new privately-insured patients.)

Short-term health insurance

The ACA implemented regulations that apply to virtually all types of health insurance. But some plans are not regulated by the law, including short-term health insurance.

As evidenced by the name, short-term plans are limited in their duration. As of 2017, a short-term plan can last no more than three months, although people who remain healthy can purchase a second short-term plan after the first one ends.

Short-term plans do not cover pre-existing conditions. So if you were to be diagnosed with glioblastoma while covered under a short-term plan, the first thing the insurer would do is go back through your medical records to make sure that you didn’t have any symptoms prior to enrolling in the plan.

Assuming you were healthy before you enrolled, your short-term plan would start to cover your treatments. But you would be facing a looming and inflexible coverage termination date, along with annual and lifetime benefit maximums. Short-term plans vary considerably in quality – some have lifetime benefit maximums of $250,000 or less, while others provide benefits well in excess of a million dollars. In the case of a glioblastoma diagnosis, coverage would end when the policy reached its predetermined end date, or when you hit your benefit maximum – whichever happened first.

Either way, you’d want to hope that you had other coverage already lined up and ready to go at that point. The cancer diagnosis would make it impossible to obtain another short-term policy.

And since a short-term plan is not considered minimum essential coverage, the termination of the short-term policy would not trigger a special enrollment period for individual or employer-sponsored insurance. You would still be able to enroll in a regular individual-market plan, or an employer plan if you’re eligible for one, during regular annual open enrollment. But you might experience a significant gap in coverage, which can be disastrous in the middle of cancer treatment.

A limited-benefit plan

Limited-benefit plans are another category of coverage that’s not regulated by the ACA (despite attempts by the Obama Administration to place some regulations on certain types of fixed indemnity coverage).

Fixed indemnity means that the plan pays a specific dollar amount if the insured has a covered claim. For example, the plan might pay $1,000 per day for hospitalization, or $50 for a doctor visit. There’s no cap on how much the patient has to pay, and these plans often have very low annual and lifetime benefit limits.

So imagine a plan that will pay $2,000 per day for hospitalization, for up to 25 days. It will also pay $2,500 for an outpatient surgical procedure and $2,500 for an inpatient surgical procedure. And it will pay $625 for anesthesia, but it does not cover prescriptions (these numbers are from a real plan currently available in the limited benefit market).

Remember that McCain’s craniotomy – before the glioblastoma was even diagnosed – likely cost $70,000. He was home very soon after the surgery, so if he was hospitalized at all, it wasn’t more than a day or two. A limited benefit plan like the one described above would have paid $2,000 for each day in the hospital (which amounts to zero dollars if the procedure didn’t result in an inpatient stay), $2,500 for the surgery, and $625 for the anesthesia. That would leave a sizeable chunk of the $70,000 bill as the patient’s responsibility.

And all of that is before the treatment for the glioblastoma even begins.

A Cruz Amendment plan

In mid-July, Senator Ted Cruz introduced an amendment to the BCRA aimed at reducing regulations on health insurance plans. The Cruz Amendment, if included in the BCRA, would allow insurers to offer non-ACA-compliant plans as long as they also offered at least one Silver plan, one Gold plan, and one plan that complies with the BCRA’s benchmark standards (58 percent actuarial value).

The non-compliant plans would likely range from decent to terrible, since they would have wide latitude in terms of the consumer protections they’d be able to waive. Essentially, it would be a return to the pre-ACA days when there was more of an “anything goes” approach to health insurance. Plans would be available without essential health benefits, would not have to cover pre-existing conditions, and could be offered with higher out-of-pocket limits than ACA compliant plans.

These plans would likely appeal to healthy people, as they would be less expensive than ACA compliant plans. But a person who seems perfectly healthy can be diagnosed with glioblastoma, at which point the holes in the coverage become glaringly apparent.

What about those who lack McCain’s coverage

In glioblastoma, Senator McCain is facing a fierce battle, and our hearts go out to him and his family. But thanks to McCain’s health coverage, he won’t have to worry about how to pay for his treatment. I’m glad he has that health coverage.

Senator McCain is not alone in his battle. There are more than 12,000 Americans who will be diagnosed with glioblastoma this year. Unfortunately, many of them do not have the level of health coverage that McCain has. Even with the best health insurance, the diagnosis plunges each family into an immensely challenging situation. With lesser – or no – coverage, the challenge becomes even more insurmountable.

Nobody deserves cancer. And nobody deserves to have to fight cancer with less-than-adequate health insurance. With our current medical know-how, we can’t keep everyone from getting cancer. But we can make sure that as many people as possible are covered by high-quality health insurance. We owe it to all the lesser-known John McCains out there to work towards that goal.

That means pushing back against any sort of “reform” that would result in fewer people with insurance. It also means rejecting proposals that would allow junk insurance plans to flood the market, lulling consumers into a false sense of security – until they’re diagnosed with brain cancer.

 

The Medicaid Fund: Beware of Gifts

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http://thenews.pl/1/11/Artykul/317380,Poland-to-open-new-museum-at-German-Nazi-Treblinka-death-camp

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Press reports have suggested that to get the Affordable Care Act repeal-and-replace effort back on track, Senate leaders are now offering, as part of their Better Care Reconciliation Act (BCRA), a $200 billion fund to help states partially offset the nearly $800 billion dollars in lost federal Medicaid funding they would face over the next decade if BCRA became law. This fund, to be administered by the U.S. Secretary of Health and Human Services (HHS), would apparently be used to help low-income people transition from Medicaid to private insurance.

The offer, if accurate, still amounts to a 75 percent reduction in funding. So the fund does little to address the human and financial consequences of BCRA’s original Medicaid cuts. It’s also unclear how it would work or affect the private insurance market. Furthermore, it’s uncertain whether the Senate parliamentarian would allow a new program. Even if permitted under the strict rules governing the Senate reconciliation process, the program would encounter major legal and operational hurdles in implementation, as well as questions about the lack of public accountability for drawing on the money. It is also worth noting that this type of strategy, in which the HHS secretary is given vast powers over how to allocate funds under the loose rubric of “transition,” may itself raise questions about whether Congress simply has thrown a handful of dollars at the problem, and coupled these dollars with an extraordinary delegation of its constitutional legislative powers to the executive branch.

Today, if a state chooses to insure a Medicaid-eligible population, the federal government will pay a percentage of actual costs. Like insurance generally, these costs can vary by the type of population insured (healthy people versus those who are sick), the amount and intensity of services furnished, and the prices paid. In any year, and in any state, costs vary enormously, a fact driven home by the economic fallout from the opioid epidemic or the Zika virus. The federal Medicaid contribution to state programs ranges from 50 percent to about 75 percent, with higher contributions for low-income adults covered under the ACA’s Medicaid expansion. Equally importantly, there is real accountability in federal Medicaid payments spent to insure people — we know how many people are covered and what services are paid for.

Over the past several weeks, a blizzard of analyses and reports has made clear just how essential Medicaid is to states, their populations, their economies, and their ability to maintain operational health care systems for everyone. Receiving 25 cents on the dollar in lieu of guaranteed Medicaid financing would be little consolation; this is particularly true since presumably, like other special payments to states under the bill, the fund can be expected to be time-limited, after which more action from Congress would be needed to extend its life.

Let’s imagine that this fund becomes law, with details to be hashed out later. A host of questions would arise, all of which would need to be translated into complex and contentious regulations, issued following a lengthy rulemaking process. For example, will normal federal matching rules apply when states draw on this fund, or will states have to put up more funding or perhaps none at all? What types of costs will be recognized as eligible for fund payments? Will all states be able to participate or just those losing expansion funding? Will states be permitted to help only selected Medicaid expansion beneficiaries losing coverage? Although the fund is billed as transitional assistance for beneficiaries, would this include direct payments to providers to allow for continuity of care? Under laws that govern agency policymaking and spending decisions such as when, where, and how to spend $200 billion, these questions and many more would need to move a formal policy development process. The HHS secretary cannot simply dole out unstructured funding that could be used for purposes only tangentially related to transitions.

No vague promises or pennies-on-the-dollar slush fund can take the place of what Medicaid does for people and for states. Nor can it compensate for the consequences of ending the compact on which Medicaid has rested for over 50 years.

State-by-State Estimates of Reductions in Federal Medicaid Funding

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Better Care Reconciliation Act (BCRA): State-by-State Estimates of Reductions in Federal Medicaid Funding – Issue Brief

Medicaid Changes under the BCRA and Possible State Responses

Our analysis examines the changes in the BCRA that would phase out the enhanced matching rate for the ACA Medicaid expansion and limit federal Medicaid spending to a capped amount per enrollee for five eligibility groups (expansion adults, other adults, children, the elderly and people with disabilities). First, under the BCRA, for states that adopted the expansion as of March 1, 2017, the enhanced federal match would phase out from 90% in 2020 to 85% in 2021, 80% in 2022, 75% in 2023 and then to the regular state match rate in 2024 and beyond. This phase out lowers federal Medicaid spending relative to current law, under which federal financing for the expansion population would remain at 90% in 2020 and in subsequent years.

Second, under the BCRA, federal Medicaid spending for most enrollees would be limited to a set amount per enrollee. To establish these limits, states would use data from FY 2014-2016 to develop base year per enrollee spending that would be inflated to 2019 based on the medical component of the consumer price index (CPI-M). Beginning in 2020, federal spending would be limited to the federal share of spending based on per enrollee amounts calculated by inflating the base year spending by CPI-M for children and adults and CPI-M plus one percentage point for the elderly and disabled. Beginning in 2025, all per enrollee limits would be increased by general inflation (CPI-U). Certain spending and populations would be excluded from the per enrollee caps, including enrollees who do not receive the full scope of Medicaid benefits.

States could respond to these changes in federal policy in several ways. We examine changes in federal Medicaid spending under two possible scenarios of state responses: (1) All states, both expansion states and non-expansion states, fill gaps in the loss of federal funding and maintain coverage, including the ACA Medicaid expansion coverage, and (2) states that expanded Medicaid under the ACA fully drop their expansions but maintain spending and coverage for other groups, resulting in declines in both federal and state spending. In the second scenario, we model the loss of federal dollars that the state would have received had it fully maintained its expansion.

Medicaid Changes in Better Care Reconciliation Act (BCRA) Go Beyond ACA Repeal and Replace

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Medicaid Changes in Better Care Reconciliation Act (BCRA) Go Beyond ACA Repeal and Replace

Medicaid Changes in Better Care Reconciliation Act (BCRA) Go Beyond ACA Repeal and Replace

The Senate released an updated discussion draft of legislation called the Better Care Reconciliation Act of 2017 (BCRA) on July 20, 2017. For Medicaid, the overall framework is very similar to earlier versions of the bill in the Senate as well as the American Health Care Act (AHCA) that passed in the House. Both the BCRA and the AHCA go beyond repeal and replacement of the Affordable Care Act (ACA) to make fundamental changes to Medicaid by setting a limit on federal funding through a per capita cap or block grant. The BCRA also includes additional changes that would further reduce federal spending for states with high per enrollee spending, limit state financing mechanisms, allow states to impose work requirements, and make other eligibility changes. The revised draft of the BCRA leaves many provisions up to HHS Secretary discretion, creating further uncertainty for states about how implementation of the legislation would proceed. Across the board, these changes would have significant implications for the 74 million people covered by the Medicaid program and for states that jointly finance and administer the program.

The Congressional Budget Office estimates that under current draft of the BCRA, federal Medicaid spending related to the coverage provisions would decline by $756 billion over the 2017-2026 period or $739 billion accounting for all Medicaid provisions in the bill. According to CBO’s longer-term projections, the BCRA would reduce federal Medicaid spending by 35% in 2036 (Figure 1). These reductions would leave states with difficult choices about how to fill in the gaps in federal funding or cut back on Medicaid eligibility, benefits, or reimbursement rates (Figure 2). This brief explains the five most significant Medicaid changes in the BCRA as well as additional Medicaid changes that could have major implications for states, providers, and beneficiaries.

5 Most Significant Medicaid Financing Changes in the BCRA

1. Phase out the enhanced federal financing for the ACA Medicaid expansion.

Under the BCRA, for states that adopted the expansion as of March 1, 2017, the enhanced federal match would phase-out from 90% in CY 2020, to 85% in 2021, 80% in 2022, 75% in 2023 and then to the regular state match rate in 2024 and beyond. Thirty-one states plus DC have implemented the Medicaid expansion (Figure 3). On average, expansion enrollees account for 20% of all Medicaid enrollees (as of early 2016) and federal expansion financing accounts for about 21% of all Medicaid funding (for FY 2015). However, these shares are much higher in some states, placing them at higher risk for facing challenges in responding to the reduction in the federal match. Multiple states are likely to eliminate or scale back their expansion coverage due to the increased cost if federal funding is reduced, including eight expansion states (AR, AZ, IL, IN, MI, NH, NM, and WA) that have legislation requiring them to reduce or eliminate the expansion if the federal match rate is reduced. Given the magnitude of estimates of how much it would cost states to replace federal expansion funds, it appears that it is unrealistic to suggest that expansion states would be able to replace those funds and continue their expansion programs at current levels without the enhanced expansion match rate. Reports suggest that waivers or additional grant funding may be offered to states in place of the enhanced funding for the expansion, however, it is unlikely that such amounts would fully offset federal funding reductions in the BCRA tied to the expansion.

2. Limit federal Medicaid funding through a per capita, or per enrollee, cap on financing.

Under current law, Medicaid provides a guarantee of coverage for individuals who are eligible for the program and a guarantee to states of federal matching dollars for spending on Medicaid services. Beginning in FY 2020, the BCRA would limit federal Medicaid funding to each state based on the sum of the costs per enrollee for five beneficiary groups – elderly, blind and disabled adults,1 children, expansion adults, and other adults – multiplied by the number of enrollees in the group and the state’s federal match rate. The proposed legislation specifies a uniform national inflation factor for the federal financing growth rate. Under both AHCA and BCRA, the per enrollee amounts would increase annually at slower rates than projected growth for Medicaid.

The caps are estimated to result in large reductions in federal Medicaid spending over time. Under BCRA, the caps would initially grow by the Consumer Price Index for medical care (CPI-M) for adults and children and by the CPI-M plus one percentage point for elderly and disabled groups. Starting in 2025, per enrollee amounts for all groups would increase by the historically lower CPI for urban consumers (CPI-U). All of these rates are lower than projected growth for private health insurance spending per enrollee. Reductions in federal Medicaid funding from the caps are expected to grow over time, especially after 2025 when the inflation factor is limited to CPI-U. Current projections have CPI-M growing at 3.7% and CPI-U at 2.4% annually; however, the rate of growth for these indices can vary and fluctuate over time which could cause uncertainty and instability in state budgeting.

3. Provides Secretary discretion to adjust per enrollee spending down for states with per enrollee spending 25% higher than the national average.

The BCRA also includes a provision not included in the AHCA, which would direct the HHS Secretary to adjust target per enrollee amounts under the per capita cap to bring states closer to national average spending. Specifically, the Secretary would adjust a state’s target per enrollee amounts by 0.5% to 2% for states spending 25% or more either above or below the national average per enrollee expenditures beginning in 2020. These adjustments are applied to overall per enrollee spending in 2020 and 2021 and then for each enrollment group in subsequent years. Adjustments are to be budget neutral to the federal government (meaning they would not result in a net increase of federal payments under the per capita caps for the fiscal year). Certain states with population densities less than 15 individuals per square mile (currently: AK, MT, ND, SD, and WY) would be exempt from this provision. Data for 2014 show that the number of states with high per capita spending that face tighter caps exceeds the number of states that would experience relief for having low spending overall and for each eligibility group (Table 1). Secretary discretion and actual spending patterns will make it difficult for states to estimate the effect of this provision.

4. Allow states the option to choose block grant financing for non-expansion Medicaid adults.

Beginning in FY 2020 under the BCRA, states could elect to receive federal financing for nonelderly/non-disabled traditional adults (low-income parents and pregnant women) and/or adults eligible through the ACA Medicaid expansion in the form of block grant instead of per capita cap funding. The block grant amount that states would receive from the federal government is initially based on the state’s target per capita spending amount for the fiscal year multiplied by the number of adult enrollees and the federal average Medicaid matching rate. The amount would grow annually by CPI-U even prior to 2025 when the per capita cap amounts would grow by the higher CPI-M inflation factor. States have a maintenance of effort (MOE) requirement—essentially, a minimum amount states must spend each year—that is the state share of the enhanced CHIP match rate (without the 23 percentage point increase provided under the ACA) multiplied by the block grant amount. If a state fails to meet the MOE requirement in a given year, its federal block grant amount for the following year would be reduced. States that meet MOE and continue to elect the block grant option can rollover unused block grant funds into the next fiscal year.

Under the block grant option, states could impose conditions of eligibility and not comply with key provisions in current law like comparability and state-wideness.  Under the block grant option, states would be required to cover low-income parents and pregnant women at current federal minimum income levels and provide certain benefits. However, states could set conditions of eligibility for groups beyond these federal minimum groups, including for ACA expansion adults. Additionally, states electing the BCRA block grant option would not have to comply with other federal requirements, including comparability (the requirement that Medicaid-covered benefits be provided in the same amount, duration, and scope to all enrollees), state-wideness (the requirement that bars Medicaid programs from excluding enrollees or providers because of where they live or work in the state), and freedom of choice of provider (that allows beneficiaries to be permitted to choose among any provider participating in Medicaid). Like per capita caps, Medicaid block grants fail to account for changes in health care costs over time. Block grants also carry additional risk for states, providers, and beneficiaries because they do not account for changes in Medicaid enrollment (which could increase during an economic downturn).

5. Provides the HHS Secretary discretion to allocate funds to address the opioid crisis and public health emergencies. 
The BCRA appropriates $45 billion for FY 2018 through FY 2026 for grants to states to support substance use disorder treatment and recovery support services with significant discretion to the HHS Secretary to allocate the funds. The BCRA also provides the HHS Secretary with discretion to exclude from a state’s per capita cap or block grant limit a total of $5 billion across all states for Medicaid spending in response to a public health emergency from January 2020 through December 2024. This exclusion would only apply during a period in which the HHS Secretary has declared a public health emergency in a state or region and also deemed an exclusion appropriate. Under current law, states can increase spending with a guaranteed federal match or seek waivers (like in Flint, MI or for states hit by hurricane Katrina) to address public health emergencies.

Other Significant BCRA Medicaid Changes

Other BCRA Medicaid changes with significant implications for states, providers, and beneficiaries include the following:

Limiting states’ ability to use provider taxes to finance their share of Medicaid by lowering the provider tax safe harbor threshold2 from 6.0% to 5.0% of net patient revenues over 5 years, beginning in 2021. All states except for Alaska currently use provider taxes to finance the state share of Medicaid, and in 2016, 28 states had at least one tax exceeding 5.5% of net patient revenues. The proposed BCRA change could shift additional costs to states or result in additional reductions in Medicaid payment rates, services, or eligibility.

Creating a state option to require work as a condition of eligibility for nondisabled, nonelderly Medicaid adults as of October 1, 2017 (with some exemptions for certain groups including pregnant women or the sole caretaker of a child under age 6 or a child with a disability). Depending on how they are implemented, work requirements could increase administrative burdens on states and adversely affect some people, who are unable to comply due to their health, family caregiving obligations, or other reasons, by preventing them from accessing needed health coverage through Medicaid.3

Cancelling scheduled disproportionate share hospital (DSH) payment reductions for non-expansion (but not for expansion) states. The BCRA would exempt non-expansion states from the DSH reductions that were included in the ACA. During FY 2020-FY 2023, the BCRA would also provide a DSH payment increase to non-expansion states with per capita FY 2016 DSH allotment amounts (the FY 2016 DSH allotment divided by the number of uninsured individuals in the state for the fiscal year) that are below the national average per capita amount. A state qualifies as a non-expansion state if it is not covering expansion adults on or after January 1, 2021. This means that current expansion states that discontinue their expansions by the end of 2020 could qualify for increased DSH funds after their expansion ends. In addition, the BCRA would provide certain non-expansion states with $10 billion over 5 years (FY 2018-FY 2022) for safety-net funding.

Changing eligibility and enrollment processes with new requirements for eligible individuals to obtain and maintain Medicaid coverage. Changes include: repealing the requirement for states to cover Medicaid benefits retroactively for three months prior to the month of an individual’s enrollment in the program except for enrollees who are eligible based on old age or disability only); prohibiting hospitals from temporarily enrolling individuals in Medicaid if they are likely to be eligible under a state’s Medicaid eligibility rules (a policy known as “hospital presumptive eligibility”); removing a presumptive eligibility option that includes health care providers other than hospitals for expansion adults; and giving states the option to renew eligibility of Medicaid expansion adults every six months (or more frequently) compared to the current 12 month redetermination period.

Prohibiting federal Medicaid funding for Planned Parenthood for one year (beginning on the date of enactment). The Hyde Amendment already prevents the use of federal funds for abortion services,4 so the effect of this proposed policy would be to limit Planned Parenthood’s capacity to provide preventive care and other services to women (such as clinical breast exams or birth control).

Repealing the enhanced federal match rate available under the ACA for the Community First Choice (CFC) state plan option, as of January 1, 2020. The ACA established the CFC option to allow states to provide home and community-based attendant services and supports to Medicaid enrollees who would otherwise require an institutional level of care. States taking up the option currently receive a 6% increase in their federal match rate for CFC services, and without this additional funding states may eliminate the option. The BCRA also creates a demonstration that would provide 100% federal matching funds for certain states selected by the HHS Secretary providing home and community-based services (HCBS) for seniors or adults with disabilities under a Section 1915 (c) or (d) waiver or Section 1915 (i) state plan authority, limited to $8 billion over four years, from 2020 through 2023. The Secretary would select participating states with priority given to the 15 states with the lowest population density. Unlike CFC, the authority for this new demonstration is time-limited, all states likely could not participate, and federal funding is capped. The $8 billion allocated to the new demonstration is less than half of the cost of the elimination of CFC funding, estimated by the CBO at $19 billion over 10 years.

Increasing the federal match rate for Medicaid services provided to American Indians by non-Indian Health Services (IHS) providers. Under existing law, the federal government covers 100% of the costs of Medicaid-covered services provided to American Indians through an IHS or Tribally-operated facility, and the BCRA would expand this 100% match rate to apply to all Medicaid-covered services delivered by all Medicaid providers to Medicaid-eligible members of an Indian tribe.

Repealing the essential health benefit requirement in Medicaid alternative benefit plans, beginning in 2020. The alternative benefit plans are required for expansion adults and a state option for benefit package design for certain other populations. While the Medicaid benefit package for children under Early and Periodic Screening, Diagnostic and Treatment (EPSDT) is comprehensive, states have flexibility to design benefit packages for adults, and many services for adults are offered at state option. If the essential health benefits requirement were repealed, there would be no federal minimum requirement in Medicaid to ensure that adults have coverage in certain areas such as mental health and substance use disorder treatment.

Republican plan to ‘repeal and delay’ will leave millions more Americans uninsured

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Image result for Republican plan to ‘repeal and delay’ will leave millions more Americans uninsured

 

Majority Leader Mitch McConnell wants to hold a vote on a bill that would repeal major parts of Obamacare and give Republicans two years to pass a replacement. A new CBO report finds that repealing Obamacare without a replacement would result in 32 million more Americans losing health insurance over a decade — far deeper coverage losses than any of the health plans Republicans have proposed. Further, 75 percent of Americans would live in areas without any insurers selling coverage in the individual market by 2026.

The latest GOP health plan would strike:

  •  Individual mandate
  •  Insurance subsidies
  •  Medicaid expansion
  •  Planned Parenthood funding

The bill would effectively kill Obamacare’s individual and employer coverage mandates, strike health insurance subsidies, roll back Medicaid expansion and defund Planned Parenthood.

Repealing Obamacare would more than double the number of Americans without health insurance.

Under Obamacare, 10 percentof Americans would lack health insurance.

But if Republicans repeal Obamacare, the number could grow to 21 percent by 2026.

NOTE: Data includes Americans under 65 who do not have health insurance and does not include persons who are Medicare-eligible.
SOURCE: Congressional Budget Office

The uninsured rate plunged under the ACA, but would now skyrocket

ACARepeal ACA0510152025%1997201020172026Before the ACAACA passed10%21%
NOTE: Data includes Americans under 65 who do not have health insurance
SOURCE: National Center for Health Statistics and the Congressional Budget Office

In the first year alone, nearly 17 million more people would no longer have insurance — or (16 percent) of Americans. That includes 10 million fewer buying plans on the individual market, 4 million fewer people covered through Medicaid, and 2 million fewer with job-based coverage.

But once Medicaid expansion and subsidies were repealed (roughly two years after enactment), the number of uninsured Americans would increase by 27 million in 2020. By 2026, about 59 million people or 21 percent of Americans would be uninsured.

CBO: ObamaCare repeal without replace would cost 32 million insurance

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CBO: ObamaCare repeal without replace would cost 32 million insurance

Image result for uninsured

Repealing ObamaCare without a replacement would result in 32 million people losing their insurance in the next 10 years, according to the Congressional Budget Office.
The bill, much of which would take effect in 2020, would also massively increase insurance premiums. According to the CBO, average premiums would increase by about 25 percent in 2018 alone. The increase would reach about 50 percent in 2020, and premiums would increase nearly 100 percent by 2026, CBO said.
Senate Republicans said this week they would consider voting on repeal only, after it appeared their replacement legislation had failed. However, negotiations attempting to revive repeal and replace continue and senators are scheduled to huddle Wednesday night to discuss if there’s a path forward.
The unfavorable score of the repeal-only bill could help jumpstart discussions about returning to the repeal-and-replace legislation.

A previous CBO score of the Senate’s repeal-and-replace bill estimated that 22 million people would lose insurance over the next decade.

The CBO hasn’t released a score on the most recent revision, which includes a controversial amendment from Sen. Ted Cruz (R-Texas).

The Senate will vote next week on a motion to proceed, though it’s not clear which bill Majority Leader Mitch McConnell (R-Ky.) wants to move to — a straight repeal or the repeal-and-replace legislation that seemed dead just days ago.

Both the House and Senate passed the “repeal-only” bill in 2015 that was vetoed by President Obama. Among other provisions, the “repeal only” bill would eliminate: ObamaCare’s individual and employer mandates, the Medicaid expansion, and subsidies for low-income individuals.

It would retain the requirements that protect people with pre-existing conditions from discrimination and would continue to require insurers to offer specific benefits.

According to the CBO “eliminating the penalty associated with the individual mandate and the subsidies for insurance while retaining the market regulations would destabilize the nongroup market, and the effect would worsen over time.”

Republicans have argued that they need to repeal and replace ObamaCare to “rescue” the growing number of people who live in counties with no insurers on the healthcare exchanges. But according to the CBO, repeal-only would make the problem worse.

The repeal-only bill would cause insurers to begin dropping out of the marketplace as soon as next year, the CBO said. It would also leave about half of the nation’s population without any ObamaCare insurers by 2020, a figure that would increase to about three-quarters of the population by 2026.

Here are the hidden items in the Senate GOP’s new Obamacare repeal bill

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The Senate GOP hid the meanest things very deeply in its Obamacare repeal bill. We found them

 

Senate Republicans unveiled a new, “improved” version of their Affordable Care Act repeal bill Thursday, so the treasure hunt is on: the search for provisions so horrifically inhumane that they’ve had to be concealed deep in the measure’s legislative language and procedural maze.

We’ve found quite a few, with the help of professional spelunkers Andy Slavitt, David Anderson, Larry Levitt and others. Here are some of the provisions in the so-called Better Care Reconciliation Act, or BCRA, that the Senate GOP really doesn’t want you to know about.

—The measure kills the birth control and women’s health screening requirements. The Affordable Care Act advanced women’s healthcare rights immensely by mandating that health plans cover contraceptives, as well as a range of preventive screenings, without deductibles or co-pays. Conservatives have been trying to roll back those guarantees since the ACA’s enactment. The new Senate bill eliminates them.

That action is part of the Cruz Amendment, on which more below. It allows states to authorize the sale of health plans that don’t include the women’s health provisions. Observes Dawn Laguens of Planned Parenthood, “Insurance companies would once again be allowed to refuse to cover basic preventive healthcare, as well as charge women co-pays for birth control, immunizations and cancer screenings.” She calls this “a major step backward for women.”

—HHS Secretary Tom Price gets enormous new power over healthcare standards and even state budgets. The essence of the amended bill’s bait-and-switch structure is the creation of several slush funds to moderate the costs to states of various repeal provisions, especially the drastic cutback in Medicaidfunding.

Those slush funds, however, would come under the control of Health and Human Services Secretary Tom Price. A known enemy of Medicaid and of expanding healthcare services for women and the needy, Price would have the authority to apportion those funds as he wishes, favoring some states over others because of their politics and policies, for example.

As former Medicare/Medicaid chief Andy Slavitt observes, there are no rules or standards guiding Price’s hand — he could dole out all the money to red states or pull funding from others at will. The money doesn’t have to go to services for low-income people or to replace lost Medicaid funding. He could shortchange states that require health plans to cover abortion — such as California and New York.

“The bill is a giant ‘Trust Tom Price’ bill,” Slavitt tweeted. And even if the money is apportioned responsibly, it’s not enough: The total in the slush funds, Slavitt calculates, would restore barely 10% of the cuts in Medicaid.

—The bill still cuts taxes for the wealthy. One widely noticed change from the original Senate bill is the retention of two taxes the ACA imposes on high-income taxpayers — those earning more than $200,000, or $250,000 for couples. These are a 3.8% surcharge on capital gains and dividends and a 0.9% increase in the Medicare tax for those taxpayers. The original Senate bill would have repealed those taxes, handing over an estimated $346-billion windfall to the rich over 10 years.

But don’t cry for the wealthy just yet. The amendment expands another windfall — health savings accounts, which are tax-preferred accounts that can be used to pay for out-of-pocket medical expanses. Under the amended bill, HSAs also can be used to pay premiums, which effectively renders premiums in the individual market tax-deductible for the first time.

HSAs sound good in principle, but in practice they’re geared to higher-income taxpayers. Although some employers help their workers fund HSAs, for the most part the accounts have to be funded out of disposable income, which many middle- and working-class families may find hard to come by. A study released this month by the Employee Benefit Research Institute found that, although the maximum annual contribution is $6,750 for families and $3,450 for individuals, the average total account contribution was $2,922 in 2016.

The Tax Policy Center says that more than 16% of all households with $200,000 in income or more have HSAs — but fewer than 2% of households earning less than $30,000 do.

The Republican repeal bills would raise the maximum contributions to $6,550 for individuals and $13,100 for families — but since most families can’t even max out their HSAs now, they plainly wouldn’t be helped by this change. Rich families would be helped, however.

—The senators exempt themselves from the loss of consumer protections. A convoluted provision in the amended measure exempts Congress and its staff members from the loss of guarantees for those with preexisting conditions and other consumer protections.

You won’t find the words “Congress” and “exemption” next to each other anywhere in the bill. You have to know that “1312(d)(3)(D)” is the provision of the Affordable Care Act requiring members of Congress and their staffs to obtain coverage through the Obamacare exchanges, and then notice, on Page 167 of the Senate bill, that the elimination of consumer protections is “non-applicable” to that section.

Senate leaders say the exemption is necessary for procedural purposes, and imply that they’ll remove it in subsequent legislation. We’ll see.

—The opioid money is a Band-Aid. Opioid addiction has emerged as perhaps the worst public health crisis in the nation. As much as 40% of the cost of treatment of addicts has been covered by Medicaid. The harsh cuts in that program imposed by the Senate and House repeal bills would force more of that expense onto states that simply can’t afford it. Meanwhile, the projected loss of medical coverage by as many as 23 million Americans under repeal will keep many victims of the epidemic from finding treatment.

The cost of fighting the epidemic and treating the secondary health problems of its victims, such as HIV and hepatitis C, has been estimated at as much as $183 billion over 10 years. The original Senate measure included only a one-year, $2-billion appropriation for the purpose. The revised bill provides $45 billion over 10 years. Interestingly, that’s exactly what was requested by GOP Sens. Rob Portman of Ohio and Shelley Moore Capito of West Virginia. So the appropriation won’t be adequate as a solution to the opioid crisis, but it might be enough to bring those two potential holdouts on board.

—The “Murkowski Mollification.” The Senate bill has a craftily-worded handout for Sen. Lisa Murkowski (R-Alaska). She’s been a holdout on the Senate bill because of its massive cuts to Medicaid, an important healthcare program in her state.

The amended measure guarantees at least $1.3 billion, or 1% of a $132-billion, 10-year bailout fund, to any state where premiums are 75% higher than the national average. Only one state qualifies: Alaska.

It’s not unusual for such provisions to be buried in legislation that appears to have broader application. Indeed, the Affordable Care Act included a so-called “Cornhusker Kickback” to benefit Nebraska and secure the vote of then-Sen. Ben Nelson. In this case, the provision means Alaska, a state with 0.2% of the nation’s Medicaid enrollment, would get a disproportionate windfall. As of this writing, Murkowski hasn’t said if she’ll take the bait. But as Slavitt observes, the payoff sets the stage for demands by senators from other states.

“If I’m WV, TN, AZ, WY, I want to know where mine is,” Slavitt tweeted. In any event, the money wouldn’t be enough to cover Alaska’s losses from the Medicaid rollback, and it would still be subject to cancellation at any time by Price.

—The Cruz Amendment is a disaster for health insurance buyers. We’ve written before about the amendment crafted by Sen. Ted Cruz (R-Texas). It would effectively destroy the healthcare market nationwide.

The amendment would allow states to authorize any insurer to offer bare-bones policies as long as they also offered at least one ACA-compliant policy in that state. This opens the door to bifurcating the insurance market. Younger, healthier buyers, especially males, might sign up for cheap policies without coverage for hospitalization, substance abuse, prescriptions, maternity or preexisting conditions. That would force everyone else to buy a fully compliant plan; since such a plan would be filled with customers with potentially risky and costly conditions, its premium would soar. As it became progressively less affordable, all but the sickest buyers would leave, making it even more costly.

This is the definition of a “death spiral” that Republicans claim they want to avoid. It makes a mockery of their promise to protect people with preexisting conditions, since the cost of insurance for them would soon be stratospheric.

—Buyers of cheap Cruz plans would be locked out of the insurance market if they get sick. A little-noticed aspect of the Cruz proposal is that the cheap plans it allows would not qualify as legitimate insurance coverage under the GOP’s “continuous coverage” rules.

Those rules, embodied in both the House and Senate GOP repeal bills, guarantee coverage for preexisting conditions as long as the buyer maintains insurance coverage without a break of longer than two months. Under the Senate bill, anyone with such a lapse would face a six-month waiting period for new insurance before the preexisting condition guarantee would be effective.

That means that individuals who get sick and discover that their Cruz plan won’t cover their illness wouldn’t be able to buy full coverage for at least six months. It’s a classic bait-and-switch, but you won’t hear it being bragged about by Senate Republicans. They don’t really want you to know.

The Congressional Budget Office, which determined last month that the original Senate bill would cost 22 million Americans their insurance by 2026 compared with the current law, hasn’t weighed in on the amended version. It’s unlikely that the CBO will think much more highly of the amendments.

For that reason, Senate GOP leaders have been hinting that they’ll skip, or ignore, any CBO analysis and rely instead on one prepared by Price’s HHS. What are the chances the HHS will deliver a credible analysis? Probably nil

Medicaid And The Latest Version Of The BCRA: Massive Federal Funding Losses Remain

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Washington, DC at the Capitol Building

Where Medicaid is concerned, the most notable thing about the latest version of the Better Care Reconciliation Act (BCRA) is that despite the drama of the past two weeks—the flood of news coverage regarding the potential impact of the losses; mounting concerns raised by Senators from expansion and non-expansion states alike; and the massive outcry from hospitals, physicians, insurers, and health care organizations—the new iteration leaves untouched the fundamental Medicaid contours of the earlier version.

The new draft retains the federal funding bar for Planned Parenthood (§ 123) as well as the earlier version’s limit on states’ ability to fund their programs through lawful, broad-based provider taxes (§ 131). The new bill does virtually nothing to lessen the financial losses to states that will flow from the prior iteration. According to the Congressional Budget Office (CBO), these losses would surpass $770 billion over 10 years as a result of provisions that eliminate the enhanced funding for the adult expansion population and superimpose flat annual growth restrictions on Medicaid’s historic federal funding formula (§124 and §132).

By 2036, CBO reports, federal Medicaid funding would be about 35 percent below current law, a catastrophe of epic proportions. According to one study that sought to translate BCRA’s Medicaid provisions into state-by-state loss estimates, California alone would lose between $37 and $52 billionbetween 2020 and 2027, depending on how the cap’s arbitrary growth limits play out over time. Indeed, depending on how the cap, which is tied to a general economic inflation rate that cannot be known with certainty, plays out against actual state spending needs—triggered by everything from new vaccines to long-term services and supports to address the opioid crisis or the consequences of Zika—the federal funding losses could grow from catastrophic to unimaginable.

Small Crumbs Of Money

Perhaps Congressional leaders have sought to convince their colleagues to disregard the CBO estimates and these studies, arguing that Congress, in fact, will never allow the bottom to fall out on states and will come through with additional funding. But the newest version of the bill underscores the fundamentally meaningless nature of such assurances.

Small crumbs of Medicaid give-backs can be found at various places in the new version. One that might be thought of as the Louisiana Purchase is designed to help one state cope with massive loss; over the long term, however, the adjustment washes out in the far larger picture of declining federal funding for an exceptionally poor state.

For purposes of setting the arbitrary growth limits over time, the original bill relied on per capita spending data from the 2014-2015 time period. The new draft would allow a late-expanding state (i.e., Louisiana) to use 2016 as its base period (§ 132). But regardless of whether it is tied to 2014-2015 or 2016, nothing can mask the fact that the base period is part of a growth formula unrelated to the real world of Medicaid spending. All state programs will be tied to the distant past where federal Medicaid funding is concerned.

Furthermore, the new version does not exempt the state from the bill’s exceptionally clumsy rate-setting procedures, which lack adjustments for volume and intensity or new technology and that allow the Health and Human Services (HHS) Secretary’s power to unilaterally alter what he considers to be unreliable state data. The measure continues to permit the Secretary to claw back what he determines to be “excessive” funding by reducing later payments without a prior hearing; in the event of state evidence of underpayment, the Secretary can withhold federal funds owed until a lengthy appeals system is exhausted.

As was the case with the prior version, the new draft tips its hat toward non-expansion states, further sweetening the pot by tweaking the disproportionate share hospital payment formula in ways that favor payments to states with the highest uninsured populations (§ 126, Restoring Fairness in DSH Allotments). Like its predecessor, the new version thus rewards states that have refused to insure their poorest residents and harshly penalizes struggling hospitals serving the remaining uninsured in those that have.

As an additional lure, the new version expands the block grant option in the earlier measure to enable states to use block grants for the ACA expansion population as well as for traditional low-income adults (§ 133). Like the earlier version, state block grant funding would remain virtually frozen, leaving states increasingly on the hook for care for millions of grievously under-funded adults.

The Illusion Of A Public Health Emergency Exemption To The Per Capita Cap

One of Medicaid’s most important dimensions is its irreplaceable role in addressing the immediate and long-term effects of public health crises. Medicaid is by far the nation’s biggest single source of health care financing for dealing with critical public health threats. These threats may begin with an initial, recognized period of a formally declared emergency. They then can morph into events with very long-term effects felt for years or decades after. This was the case with the World Trade Center attacks, which led to an immediate surge in health care spending, followed by years of elevated spending to address the long-term health fallout triggered by the emergency itself. One need think only about Zika or the opioid crisis now gripping the nation to understand the near-term/long-term nature of public health threats.

Medicaid enrollees are disproportionately likely to live in poor communities, and poor communities are disproportionately likely to face public health threats ranging from environmental hazards to infectious disease. These communities also are inherently less likely to have fewer resources to cope with the effects of an emergency. Thus, a program such as Medicaid is crucial in its ability to deploy health care financing resources to the hardest-hit populations. Indeed, two thirds of all Louisiana Medicaid beneficiaries lived in the parishes affected by Hurricane Katrina.

Section 319 of the Public Health Service Act authorizes the HHS Secretary to declare the existence of a public health emergency arising from events such as a “disease or disorder,” “significant outbreaks of infectious diseases or bioterrorist attacks,” or other events identified as public health emergencies by the HHS Secretary. Whether to declare an emergency is entrusted to the Secretary’s judgment, and during the immediate emergency period, the Secretary enjoys expanded powers to deploy resources to designated populations or geographic areas. These special powers end when the declared emergency period ends. In the aftermath, states and local communities effectively are on their own, relying on the resources they have.

In and of itself, a loss of federal health funding as large as that imposed by BCRA elevates the threat risk. This risk grows exponentially when a true crisis hits, if Medicaid is crippled in its ability to provide a large-scale surge in public health care spending both during the emergency and thereafter. To understand how little the revised bill does to mitigate the crippling impact of the initial draft one need only look carefully at what the revisions would do when a true emergency strikes.

The press release accompanying the new draft states that “if a public health emergency is declared, state medical assistance expenditures in a particular part of the state will not be counted toward the per capita caps or block grant allocations for the declared period of the emergency.” But a close read of the actual bill text reveals its fundamental inadequacy.

First, the period of exemption lasts only five years, from January 1, 2020 through December 31, 2024. Emergencies happening after this date won’t qualify for the spending adjustment. Second, the bill provides no additional federal spending during the period of a declared emergency. The draft simply allows states to eventually qualify for additional federal funding in the years following the emergency if they can prove to the Secretary that their spending on the affected population went up compared to prior years and then only for immediate emergency costs. What state will have the money in advance? And what state will be able to take a chance on spending more given the purely speculative nature of whether an emergency will be declared and emergency expenditures recognized?

Third, states would receive no additional funding ever unless the HHS Secretary actually declares an emergency in the affected portion of the state or for the state’s affected populations. Many public health threats may not rise to a level that triggers a formal Secretarial determination, and the Secretary may be inclined not to make such a determination because of other, spillover effects that come with such a determination, such as the elevated demand for other types of resources.

Fourth, the additional amount of federal funding made available would be limited to the difference between what the state spent on the population in connection with the emergency and the state’s previous expenditures for the same population. Expenditures to cope with the emergency aftermath would not count, and of course these expenditures likely would not occur simultaneously with the emergency expenditures. For example, Zika has triggered emergency expenditures aimed at preventing the spread of the virus, but the true costs of Zika will roll out slowly in the form of babies left permanently and severely disabled by the virus.

And here is where the public health implications of BCRA become clear: other than exempting state expenditures on children classified as disabled from the caps, the revised bill, like its predecessor, makes no adjustment for long-term consequences. To be sure, as just mentioned, BCRA does exempt state expenditures on severely disabled children from the federal cap. But because the vast majority of children qualify for Medicaid based on poverty, this type of cramped classification system for measuring exemptions is sure to exclude spending for millions of children in severely compromised health from the exemption process.

Fifth, the bill allows only $5 billion in the aggregate for all additional federal funding over the five-year time period covered by the emergency exemption. In other words, the bill essentially creates a five-year, $5 billion mini-block grant to help all states address Medicaid spending for all emergencies occurring during this time period. The incredibly small size of the block grant alone would be likely to incentivize the HHS Secretary to avoid declaring emergencies out of concern that the money won’t be there to cover them.

In the end, the newest iteration of BCRA does nothing to alleviate the catastrophic effects of its predecessor: the difference in magnitude between what Medicaid can do today and what it will be capable of doing in the future is incalculable.