[June 15, 2017]

120 Patient Organizations Call on Senate to Defend Medicaid

Earlier today, 120 leading patient organizations came together to express grave concerns about potential Senate actions on Medicaid. Together, the groups implored Senate leadership to protect the Medicaid program and oppose efforts to roll back Medicaid expansion or change Medicaid's funding in a way that would harm patients and consumers.

In a letter to both Senate Majority Leader Mitch McConnell and Chairman of the Senate Finance Committee Orrin Hatch, the 120 organizations urged the Senators to:

• Defend Medicaid as a critical lifeline for patients and consumers with ongoing health care needs. For instance, Medicaid covers roughly one half of all births, including many high-risk pregnancies, and more than 6 million older adults rely on Medicaid to get the treatments they need.
• Reject efforts to convert Medicaid to a per capita cap or block grant system. Per capita caps and block grants would limit the ability of patients and consumers to access breakthrough treatments and constrain the program's ability to address emerging health threats, undermining Medicaid's role as a safety net for the most vulnerable Americans.
• Maintain Medicaid expansion. Because Medicaid is such a critical source of coverage for people with chronic diseases, eliminating Medicaid expansion at any point in time would make many of them more vulnerable to high medical costs.

Proposals to phase out Medicaid expansion and impose per capita caps, like those included in the American Health Care Act, would limit patients' access to care and threaten Medicaid's ability to provide critical coverage to the tens of millions of patients who rely on the program to get the care they need to live healthy, full lives.

Read the full text of the letter and complete list of signing organizations below.

June 15, 2017

Dear Majority Leader McConnell and Chairman Hatch:

The undersigned organizations, representing patients, consumers, and health care providers, write to express grave concern about potential changes to the fundamental structure and purpose of Medicaid, a vital source of health care for patients with ongoing health needs.

Proposals to phase out Medicaid expansion and implement per capita caps or block grants, like those included in the American Health Care Act (AHCA), HR 1628, threaten the ability of Medicaid to provide critical health care services to many of our most vulnerable citizens. These proposals aim to achieve billions of dollars in cost savings at the expense of tens of millions of patients and consumers who rely on Medicaid for life-sustaining care. We vehemently oppose converting Medicaid's financing into a capped funding structure, as well as phasing out Medicaid expansion, and will not accept any policy that cuts costs at the expense of patient and consumer access to care.

Medicaid is a Critical Lifeline for Patients and Consumers

Medicaid is a crucial source of coverage for patients and consumers with serious and chronic health care needs. Pregnant women depend on Medicaid, which covers roughly 50 percent of all births, including many high-risk pregnancies.¹ Medicaid covers cancer patients: nearly one-third of pediatric cancer patients were enrolled in Medicaid in 2013 and approximately 1.52 million adults with a history of cancer were covered by Medicaid in 2015.² Over 50 percent of children and one-third of adults living with cystic fibrosis rely on Medicaid to get the treatments and therapies they need to preserve their health.³ Nearly half of children with asthma are covered by Medicaid or CHIP and adults with diabetes are disproportionately covered by Medicaid as well.^4,5 Over six million older adults also rely on Medicaid, many of whom depend on the program for long-term services-like help with bathing, dressing, eating, and toileting-and supports because there are no widely accessible and affordable alternative sources of payment for this care other than out-of-pocket. Americans with a history of cardiovascular disease make up 28 percent-nearly one third-of all Medicaid patients. The patients and consumers we represent are eligible for Medicaid through various pathways, including through income-related and disability criteria.

Reject Per Capita Caps

The proposal to convert federal financing of Medicaid to a per capita cap or block grant system is deeply troubling. These policies are designed to reduce federal funding for Medicaid, forcing states to either make up the difference with their own funds or cut their programs by reducing the number of people they serve and the benefits they provide. These cuts would impact families across this country-including millions of middle class families who rely on Medicaid for long-term supports and services, nursing home care or services for a family member with disabilities.

While the AHCA proposed massive cuts to Medicaid, adjustments to the structure of the per capita caps, such as changing the baseline year or growth factor, do not resolve the fundamental problems with this policy. A per capita cap or block grant will result in less money for patients and consumers who get their care through Medicaid, plain and simple, and it creates a framework to further reduce spending down the road as lawmakers see fit. During every budget crisis or whenever legislators need a pay-for, Congress could decrease the inflationary adjustor to further reduce funding for the program.

In order to save money, per capita caps and block grants are set to grow more slowly than expected Medicaid costs under current law. As the gap between the capped allotment and actual costs increases over time, states will be forced to constrain eligibility, reduce benefits, lower provider payments, or increase cost-sharing. For patients and consumers with ongoing health care needs, per capita caps could mean that Medicaid no longer provides access to their health care provider or covers the care and treatments they need, including breakthrough therapies and technology. This could be devastating for people with serious diseases, for whom groundbreaking treatments represent a new lease on life. For people with cystic fibrosis, cancer, arthritis, and other chronic conditions, new therapies can greatly improve quality of life and increase life expectancy. In fact, our communities already have experiences, some dire, in which Medicaid programs have denied patients needed therapies because of budget constraints. A per capita cap will only exacerbate the downward pressure on Medicaid budgets and will further reduce access to these treatments for patients.

Per capita caps and block grants would also cut Medicaid most deeply when the need is greatest, because funding would no longer increase automatically in response to changing demographics or emerging public health threats. For instance, Medicaid has been a critical tool for states in fighting the recent opioid epidemic. Under a per capita cap proposal, no additional federal funds would flow to states to help them combat such crises. Constraining Medicaid in the face of the growing threat of the Zika virus could mean that states do not have the resources needed to care for infants who may be affected, leaving families with few options for care. Per capita caps are also not responsive to the aging of baby boomers because the caps make no distinction between the "young-old" (65-74) and the "old-old" (85 and older), the latter of whom will likely need much higher levels of service at significantly higher costs. In Medicaid, adults ages 65-74, on average, cost less than half per person than adults ages 85+.⁶ A rigid funding structure that provides no flexibility for states in the face of shifting demographics or new public health crises is a stark contrast to the federal/state partnership that exists today and simply shifts costs to states, taxpayers, and families.

Pairing financing reforms with increased flexibility, as has often been proposed, would further undermine Medicaid's role as a safety-net for patients and consumers. Without guardrails provided by federal requirements-coupled with reduced federal funding-states could reduce benefits and eligibility as they see fit and impose other restrictions, such as lock out periods and time limited enrollment, prioritizing cutting costs over patient care. The implications of this would be serious for those with complex health care needs. For a person with cancer, lock out periods could mean a later-stage diagnosis when treatment costs are higher and survival is less likely. For a person with diabetes, this would risk the ability to adequately manage the disease. This is true for rheumatoid arthritis as well; if patients do not have ready access to the treatments they need, they could end up costing the state much more in direct health and disability costs, and indirect costs in the forms of lost wages. For an older adult or person with a disability, a shortsighted cut to optional home and community based services could leave them with no choice but to move to a nursing home, a service that can actually cost three times as much per person on average in Medicaid. Many of our patients rely on costly but critical services that will quickly be targeted for cuts if states are given such flexibility, so it is imperative that current federal safeguards remain in place.

Maintain Medicaid Expansion

Nearly half of adults covered by the Medicaid expansion are permanently disabled, have serious health conditions-such as cancer, stroke, heart disease, arthritis, pregnancy, or diabetes-or are in fair or poor health.⁷ Proposals to eliminate the state option to expand Medicaid and to eliminate the enhanced match for any enrollee with even a small gap in coverage would result in millions of vulnerable people losing coverage.^8,9 By eliminating the enhanced federal match for any enrollee with more than a month's gap in coverage, eventually states will be on the hook for billions of dollars to continue covering this population-an insurmountable financial hurdle. Additionally, seven states have laws that would effectively end Medicaid expansion immediately or soon thereafter when the expansion match rate is eliminated. Whether the trigger date is in three years or further down the road, the effect is the same: repealing Medicaid expansion will leave patients without the coverage they depend upon to maintain their health.

The proposed financing reforms are a fundamental shift away from Medicaid's role as a safety-net for some of the most vulnerable members of our society. Repealing Medicaid expansion would leave millions without the health care they rely upon. Our organizations represent and provide care for millions of Americans living with ongoing health care needs who rely on Medicaid, and we cannot support policies that pose such a grave risk to patients and consumers.

We hope that we can maintain a productive dialogue as you move forward in this process to arrive at solutions that provide all Americans with high-quality, affordable care regardless of an individual's income, employment status, health status, or geographic location.

Thank you for your consideration.

Sincerely,

CC: Senate Democratic Leader Charles Schumer
Finance Committee Ranking Member Ron Wyden

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