Terry H. Schwadron

Feb. 1, 2020

Here comes the attack on social programs.

The Trump administration announced this week that it would allow states to limit Medicaid spending for many poor adults and the disabled. Through block grants, the federal government would not only cap its own spending — pushing a chunk of health spending to the states — but then to allow states to cap theirs.

It’s the opposite of health care for all.

Once Obamacare, the Affordable Care Act, kicked in, some states expanded the eligibility under Medicaid, health for poorer residents. Others balked. Then Seema Verman, administrator of the Centers for Medicare and Medicaid Services, put in rules that require adults to work or train for a job, and that has led to court challenges.

In Arkansas alone, 17,000 were cut from Medicaid eligibility. In Oklahoma, where there is a campaign to expand Medicaid eligibility, Republican Gov. Kevin Stitt said his state would be among the first to seek federal approval for the new spending arrangement, in part to fight that campaign.

Once again, the Trump administration is changing rules while avoiding going before Congress — which voted in 2017 against cutting these same Medicaid funds. Once again, just what the limits will be are subject to complex rules that disguise the results. But the direction here is clear — less government support for adult health among those least able to afford it. Once again, this will end up in the courts.

Verma nevertheless argued that this move is needed to sustain programs for those who most need them.

There are 14 states that have not expanded Medicaid. With fewer funds available, logically, fewer people will be served. An alternative is to cut down the benefits offered, to eliminate pregnancy coverage, for example, or other disabilities. A New York Times analysis explains that Medicaid has always provided unlimited federal matching payments to states based on whatever they spend providing care to the poor. Some of what the program covers is mandatory — emergency and hospital care, for example — but states can also choose to provide additional benefits, such as dental care or prescription drugs. No matter how much a state’s enrollment or spending rises, the federal share of funding rises with it.

Under the new proposal, a state would use a formula to determine ahead of time how much it will spend on its adult Medicaid population in a given year, then get a fixed federal share in either a lump sum or a per-person amount. It is called “the Healthy Adult Opportunity.”

Today, states must cover all medically necessary drugs, but the proposal appears to allow states that participate in the block-grant program to exclude certain drugs, perhaps an effort to encourage competition in the marketplace.

Republicans have proposed block grants in various forms for decades, most recently in 2017. Concerns about the potential of deep cuts to Medicaid, which now serves more than 71 million people, or more than 1 in 5 Americans, at a cost of about $620 billion a year, helped kill the effort.

Of course, we also are in a time of growing income inequality and of job growth — though mostly of lower wage jobs — and a burgeoning senior population.

Trump has signaled support for both cutting social spending and defending against cuts, depending on the forum.

In the past, most adults who qualified for Medicaid in the past were disabled, pregnant or extremely poor parents of small children, newer eligible people includes adults who may be healthy and childless and have somewhat higher incomes.

Trump has signaled support for both cutting social spending and defending against cuts, depending on the forum. Clearly, the constant Trump refrain has been to reject all aspects of Obamacare though he has never come up with a workable alternative.

As a result, Obamacare has emerged as a minimum benefit for Democratic opponents, extending into calls for public options for all of health care access or “Medicare for All” proposals for health care.

We’re well advised to demand that Trump clarify how he keeps cutting health care while claiming that he is protecting it.