The Serious Danger of Administrative Attacks Upon Medicaid

While 2017 saw multiple legislative assaults upon the Affordable Care Act, and long-standing health care for highly vulnerable people through the Medicaid Program, these efforts were stopped by Congressional Democrats and a handful of Republicans who crossed party lines. These leaders prevented the legislative dismantling of Medicaid– through draconian cuts, block grants or other funding and structural changes, preserving the nation’s health care and coverage program for low income children and families, children and adults with disabilities, pregnant women, and seniors, among others.

Public opposition to these efforts from governors, state officials, advocates and families was fierce, perhaps unprecedented, and only intensified as the year went on.

As public support for not repealing the ACA, and in favor of universal health care coverage, has grown during recent years, Congressional Republicans, deeply divided over health care themselves, continued the assault. Following earlier unsuccessful attempts in 2017 to “repeal and replace” the ACA, a dramatic thumbs down vote in July from Senator John McCain, on the so-called “skinny bill,” sank another “repeal and replace” bill that was also opposed by insurers, the Congressional Budget Office, and other experts.

One final push in September — the Graham-Cassidy bill, resulted in another botched attempt — the fourth legislative failure to repeal the ACA since the previous summer.

All these legislative attempts were highly publicized, politicized and garnered strong protests from diverse public and private fronts. The renewal of the Children’s Health Insurance Program (CHIP), a program with nearly-unanimous and bipartisan support in Congress, carried over into 2018 in a months-long and highly public battle, when it was finally renewed for 10 years in February.

2017 was a bad year for kids. Some policy experts considered it one of the worst in decades. Healthcare and children’s advocates, along with many others, held the legislative line. We breathed a small sigh of relief when the 2017 legislative year adjourned. Not for long, and other developments had been occurring elsewhere.

Enter 2018 — a critical year for Congress with an upcoming mid-term election that may dramatically change the balance of power; and legislators now leery of alienating constituents who deeply value their health care. In recent months, dangerously quiet administrative attacks upon health care and coverage for vulnerable people have proliferated. Often flying under the radar, these attempts prove more difficult to garner public comment and opposition since the process is so very different — and far less public — than the legislative process.

So, if you can’t legislate it, regulate it. Votes from the peoples’ representatives are not required.

In January 2018, the Centers for Medicare and Medicaid Services (CMS) issued a guidance letter to state Medicaid directors, encouraging them to submit state waivers focused on “work requirements” for state Medicaid programs. These waivers would require certain people to be employed in order to receive health care.

Medicaid waivers involve changes or “exemptions” from Medicaid requirements. These changes could involve programs, populations served, benefits, cost sharing, or any number of variables. States have traditionally used waivers to add or change the way services are delivered for special populations such as children and adults with autism spectrum disorder, people with disabilities, people with mental health or substance use needs, people who are eligible for both Medicaid and Medicare (“dual eligibles”), etc. There is latitude for states to develop and utilize waivers that may assist them in more effectively serving and tailoring their programs to the needs of low-income and other vulnerable individuals, particularly children. Such waivers must be approved by the U.S. Department of Health and Human Services (HHS), pursuant to one of several waiver provisions.

The “work requirements” waivers fall under the authority of Section 1115 of the Medicaid statute. Section 1115 waivers are defined as “research and demonstration projects” to promote the objectives of the Medicaid program, and pilot ways to increase access to care, with evaluation requirements.

A plethora of blogs and articles have detailed the many facts and studies that show the purported rationale for work requirements in Medicaid — e.g., “encouraging people to work” — will not, in reality, work. This approach will not help people find work, and will decrease access to health care for highly vulnerable people. This is very bad policy for children. The negative impacts upon children and parents in low income families, children with disabilities, children of parents with disabilities, behavioral health, or substance use needs, will likely be enormous. The impact upon people with disabilities will be devastating. As one commentator stated, “Requiring Medicaid recipients to find employment is a cruel solution to a nonexistent problem.”

Despite purported “protections” for certain vulnerable groups, these waivers will have a disastrous effect on people’s ability to get and remain covered under Medicaid, due to bureaucratic and programmatic hurdles that are immense, poorly understood, and have not worked in other programs like Temporary Assistance for Needy Families (TANF). Along with punitive requirements that don’t work, there are no supports or funding to help vulnerable people actually meet these requirements. This is a pending catastrophe for parents and children.

What these waivers will accomplish is the systematic removal of Medicaid recipients, including children, from severely stressed state budgets. That means eligible people, including parents and children, will lose their health care and get sick or sicker, endanger public health, and return to emergency rooms, all of which were among the most significant and highly expensive problems addressed with the Affordable Care Act and its Medicaid expansion.

These waivers are being approved when children’s uninsured rate, thanks to the ACA and CHIP, is at an all time low of 4.5 percent. It makes no sense. Children’s health coverage has been demonstrated to increase when their parents’ coverage does. Moreover, the human cost of losing critical health care is unfathomable in its repercussions upon the health, dignity, well-being, mental health, employment, housing, and untold number of factors for children and families.

Even from a purely financial savings standpoint, it is arguable that savings from fewer Medicaid recipients will be lower than the administrative costs required to actually implement these multi-layered requirements. We don’t know for sure, because states, in their rush to an ideologically driven policy, haven’t figured that part out yet. As stated by Jeff Myers, CEO of Medicaid Health Plans of America, “Rolling out new eligibility determination criteria will be administratively complex. For example, new information needs to be collected and tracked via new systems that need to be tested and installed, along with incurring new personnel costs to run them. The overall cost of this undertaking should be carefully considered by states before jumping on the bandwagon.”

It can be argued that this is not about increasing access to work or “independence.” It is about highly conservative political ideology and flies in the face of years of rational and proven progress toward what the vast majority of the country wants — greater, not lesser, health care coverage.

In early March, Arkansas became the third state, following Kentucky and Indiana, to receive HHS approval of it work requirements waiver, eliminating 60,000 Medicaid recipients according to state estimates. It joins Kentucky, where the uninsured rate fell from 16.3% to 7.2% following its Medicaid expansion (one of the largest reductions in the country), and Indiana, which has already lost an estimated 60,000 recipients due to its state plan for Medicaid expansion. Several more states have submitted or are considering applications.

Aside from the fact that “work requirements” waivers will not work, there is another equally, if not more, fundamental question. Are they legal? Questions abound as to whether work requirements are contrary to the very intent and objectives of the Medicaid program. A federal lawsuit challenging the Kentucky waiver is supported by a group of more than 40 legal health scholars whose friend-of-the-court brief contends the waiver approved by HHS violates the intent of Medicaid, stating in part, “This so-called ‘demonstration’ waiver, ‘destroys, not improves, Kentucky’s substantial health care achievements and defeats, rather than promotes, Medicaid’s purpose.’”

A new analysis estimates that work requirements waivers could impact 1.7 million Medicaid recipients in 10 states — about half of the recipients in those states.

All this unfolds in the wake of another ideologically driven development — the passage and signing of the “Tax Cuts and Jobs Act,” Public Law 115–97, bad policy for kids in multiple ways, and increasing the U.S. deficit to more than $1.5 trillion.

In an April 9 update, the Congressional Budget Office (CBO) estimates that figure is now actually $1.9 trillion. Outgoing Speaker Paul Ryan cites the dramatic increase in the deficit as a somewhat gaslighting rationale for further cuts to the nation’s assistance to the poor, particularly Medicaid.

On April 10, the Administration issued a very quiet, broad, and devastating Executive Order that could eviscerate the very purpose, intent, and positive benefits of an array of public assistance programs. The order, with the mind-bending title of “Reducing Poverty in America,” calls for greater barriers for recipients to gain access to Medicaid, nutrition assistance, and low-income housing subsidies.

Once again, if you can’t legislate it, regulate it. Or order it. With Republicans realizing they do not have the public support to legislate changes to Medicaid, Medicare, Social Security, or other public assistance programs, they are handing the baton to the president. Acknowledging this reality and the president’s order, Representative Tom Cole (R-OK) noted, “I think it’s very tough to get this thing through the Senate when it requires 60 votes. I certainly don’t have any problem with the president taking initiative.”

We are in the midst of an unprecedented, and alarmingly quiet, assault on principles that form the foundation of our democracy — health care and assistance to the most vulnerable among us. It’s not 2017 anymore. It’s 2018, with a mid-term election that may be the most consequential ever. We do not have highly publicized rallies and legislative battles. We have a polarized administration determined to quietly accomplish on its own what Congress has not been able to publicly accomplish legislatively. The need to be involved, educate about, and work against the dangerous consequences of these actions is greater than ever.