NJBIZ

GOP's American Health Care Act: 'The End Of Medicaid As We Know It'

NJBIZ — March 13, 2017

By Anjalee Khemlani

There are few issues that can unite major stakeholders to one side, but it is happening with the GOP's American Health Care Act. The proposal to slash Medicaid expansion and convert funding into block grants seemingly has everyone at the table shaking their heads.

"It's the end of Medicaid as we know it," said Ray Castro, a health care policy expert with the New Jersey Policy Perspective.

Castro spoke on a panel of health care industry representatives at an NJPP event Friday. The panel included Betsy Ryan, CEO and president of the New Jersey Policy Perspective; Ward Sanders, CEO and president of the New Jersey Association of Health Plans; Maura Conllinsgru of NJ Citizen Action; and Judy Solomon of the Center of Budget and Policy Priorities.

New Jersey was ranked eighth in the nation in Medicaid usage and was recently ranked as the seventh lowest state with a premium raise as a result of the Affordable Care Act, according to national reports.

Castro said the state's utilization of funding means it stands to lose the most.

Or, as the moderator and Princeton University faculty member Heather Howard said, states like Texas are being "rewarded" for not having chosen to expand Medicaid. They will get the same lump sum of money as New Jersey, despite not having the same need.

New Jersey has at least one-fifth of its residents, including the elderly and children, covered by Medicaid, Castro said.

Collinsgru said, "All the progress we've made insuring almost 1 million people in New Jersey is wiped out. This is a death spiral in the making."

And who can better predict a death spiral than the policy experts in New Jersey, where a similar model to the ACA existed more than a decade before.

That model, too, had been described as having been in a slow death spiral.

The problem was that despite its perks, like allowing pre-existing conditions and having children on their parents plans until age 31, the voluntary enrollment was unable to sustain the risk pool and kept costs high, Sanders said.

But under the Affordable Care Act, New Jersey hasn't done badly for itself. With more individuals covered commercially and the expansion of Medicaid, costs have decreased.

A recent U.S. News report with data from McKinsey & Co., shows New Jersey ranked eighth in the country for the best health care due to its scores for health care access, quality and overall health of the population.

In 2015, according to the Commonwealth Fund, New Jersey ranked 21 overall for access and affordability.

Costly non-emergency visits to the ER have been diverted to primary care, according to experts like Ryan who are afraid all the groundwork for stabilizing the market in the state will be washed away with the GOP bill.

"We see this as causing a spike in charity care again," which has continually lost funding in recent years due to Medicaid expansion, Ryan said. "We have really focused on keeping patients well and out of the hospital. And this turns back on its head. Not only will we be moving in the wrong direction in terms of the uninsured, but we will be providing care in the highest cost settings again, and I see this is as increasing health care costs."

The cost will not only increase for the low-income population, as Medicaid has often been tied to, but for the elderly who rely on Medicaid for long term and nursing home care, as well as children who benefit from the coverage.

Collinsgru said the issue is one that has brought stakeholders not usually on the same side together.

"It is remarkable that all of the stakeholders at this table are all on the same page. That happens maybe once in a decade, maybe twice now if we get out-of-network," she said.

Solomon noted that the GOP appears to be focused on pushing the bill through as fast as possible rather than actually fixing Obamacare in the easiest possible way through the Senate budget reconciliation.

"No one thinks the ACA was perfect," she said. "There were a lot of things many of us were thinking about and working in advance of the election. This, obviously, is not it. It doesn't even measure up to what we have, let alone make it better."

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