Prior to being elected, Donald Trump published a contract with voters outlining what he would do during his first 100 days. One promise Trump made that has been getting a lot of attention lately and that could have significant impact on seniors and persons with disabilities is the repeal and replacement of the Affordable Care Act (“Obamacare”).
In fact, the first executive order signed by President Trump following his inauguration addressed the Affordable Care Act.
In the order, relevant federal agencies are directed to waive or defer provisions that “impose a fiscal burden on any State or a cost, fee, tax, penalty, or regulatory burden on individuals, families, healthcare providers, health insurers, patients, recipients of healthcare services, purchasers of health insurance, or makers of medical devices, products, or medications.”
In his contract with voters, Trump states he will work with Congress to fully appeal Obamacare and replace it with Health Savings Accounts, the ability to purchase health insurance across state lines and let states manage Medicaid funds. Letting states manage Medicaid funds means either a Medicaid block grant, or per capita spending on Medicaid.
Medicaid Block Grants or Per Capita Caps
The per capita model would set a per enrollee cost that would not account for changes in the costs per enrollee beyond a specified growth limit, which would be set below the projected rates of growth under current law. Under a block grant, states would be given a set amount of Medicaid funding based in part on the state’s current Medicaid spending.
While the per capital model could control federal spending on Medicaid and give states additional flexibility, it may also provide states with an incentive to reduce Medicaid payment rates and restrict benefits. Advocates are concerned that enrollees with high costs could be prevented from qualifying or saddled with high premiums or cost sharing that is unaffordable.
The Urban Institute, which has analyzed Medicaid block grants and per capita proposals, notes in an article published by Forbes.com that both policies would reduce states’ authority to make policy decisions over their own programs while threatening benefits that low-income people often need but can’t afford. In addition, block grants would favor states with higher incomes since they spend more on Medicaid and would therefore get more money allotted by way of a larger block grant.
Medicaid block grants are nothing new. They have been proposed several times over the past 20+ years but never implemented. While not likely to be implemented in the first 100 days, this is an issue to watch as alternatives to Obamacare are explored and negotiated by Republican Congressional leaders and President Trump.
Confusion over Repeal of Obamacare
Media reports the last week have focused on what appears to be disparity between what President Trump says about repealing Obamacare and how it will be replaced, and what Republican leaders are saying publicly. A New York Times article highlighted a recent Congressional Budget Office report that concluded 18 million could lose their health insurance within a year if Obamacare is repealed without a replacement.
Trump and Republican leaders have stated that they are working on a replacement plan. Given the complexity of the issues and the number of people impacted by the future changes, it is likely that lawmakers will take their time and we will not see anything passed within the first 100 days of the Trump Presidency.
One certainty is that the next 100 days and all of 2017 are shaping up to address critical issues affecting seniors, persons with disabilities, and Veterans. Another certainty is that elder law attorneys will be watching closely in the coming months and years as new laws are passed.