Debate over Medicaid expansion and helping the poor continues over Biden’s Build Back Better Act

By Bethany Blankley | The Center Square

In addition to not funding Texas’ Medicaid waiver to help the poorest Texans, another “particularly cruel” Biden administration plan could hurt them even more, David Balat with the Texas Public Policy Foundation argues.

Reforming Medicaid, rather than expanding it, is the better approach, and the Texas Legislature has implemented reforms to help Texans have access to medical care that won’t bust the state’s budget, Balat told The Center Square.

The “particularly cruel” aspect of the Democrats’ $1.75 trillion Build Back Better plan, he notes, is the billions in federal Medicaid funding to be cut for hospitals, which primarily serve Medicaid patients in these 12 non-expansion states.

Kaiser Health News notes, “To encourage existing Medicaid expansion states to maintain their coverage levels, the bill would raise the 90% federal matching rate for the expansion population to 93% from 2023 through 2025.

“To help pay for that coverage and incentivize holdout states to expand Medicaid, starting in 2023 the plan would permanently cut billions in special federal Medicaid funding to the non-expansion states that helps hospitals with disproportionately high rates of uninsured or Medicaid patients.”

The proposed funding cuts to non-Medicaid expansion states, the American Hospital Association estimates, would amount to roughly $7.8 billion in losses over 10 years.

“In other words,” Balat said, the way to pay for the program is “by slashing funding for hospitals that already serve Medicaid recipients.”

The BBB proposal would primarily impact 12 states, including Texas, that opted not to expand Medicaid through the Affordable Care Act.

In 2012, the U.S. Supreme Court narrowly upheld the ACA and allowed states to voluntarily expand Medicaid under the program.

Medicaid expansion extends eligibility to the federal program to adults up to age 64 with incomes up to 138% of the federal poverty level.

Previously, Medicaid wasn’t available to non-disabled adults under age 65 unless they had minor children and only those within certain income thresholds. Expansion first took effect in 2014 and has since been implemented in 38 states.

The Foundation for Government Accountability notes that expansion states have enrolled more than twice as many able-bodied adults as expected, placing burdens on state and federal budgets that are unsustainable.

Expansion has also expanded fraud, waste, and abuse to an already bloated federal welfare program. Instead of helping the truly needy, it traps able-bodied adults in dependency on the federal government, FGA argues.

The FGA reports that Medicaid improperly spent $86 billion last year alone, arguing, “The federal government wasted more money in Medicaid than Texas spent on everything.”

One of the reasons why the non-expansion states have refused to expand Medicaid is because it already provides poor service and wastes taxpayer money that could be better spent on better healthcare, TPPF and FGA argue.

Worse still, FGA argues, “Millions of able-bodied adults are now dependent on Medicaid – and the majority of them aren’t working. The number of able-bodied adults dependent on Medicaid has quadrupled since 2000, and as enrollment continues to skyrocket, so does the financial burden. Increased enrollment has led to spending surges, straining state budgets, threatening resources for the truly needy, and leaving taxpayers on the hook with no end in sight.”

Less than half of all Texas doctors are enrolled in the Medicaid program because it doesn’t pay, Balat added. Fewer doctors are taking new Medicaid patients, according to the Medicaid and CHIP Payment and Access Commission.

“Long waitlists, reduced access to doctors, lack of prescription coverage, and a scarcity of treatment options have plagued Medicaid for decades,” he said. “Adding millions of able-bodied, single childless adults to a dysfunctional program only makes those problems worse.”

As a result, Texas pays more than $1 billion on emergency room claims alone, TPPF notes, because when Medicaid enrollees can’t get a doctor’s appointment, they go to the ER.

Currently, 166,416 Texans with disabilities, mostly children, are on an interest list waiting for Medicaid coverage, according to the Texas Health and Human Services Department.

In Texas, non-disabled adults without minor children are ineligible for Medicaid regardless of income, according to HealthInsurance.org.

“Parents with minor children are only eligible if the children are enrolled in Medicaid and if the household income doesn’t exceed approximately 14 percent of the poverty level,” the site reports. “For a single parent with two kids, the parent is only eligible for Medicaid if the kids are on Medicaid and total household income doesn’t exceed $230/month.”

Groups like the Southerners for Medicaid Expansion coalition and Every Texan, formerly the Center for Public Policy Priorities, argue Medicaid expansion is the best way to expand coverage for low-income Texans and the BBB plan would help the poorest Texans.

The coalition lauds the BBB plan, arguing it “takes a transformative step … to fulfill the promise of the Affordable Care Act.”

The group Every Texan argues the proposed policy changes “would take huge strides in expanding health care coverage and access for families and children and preventing lapses in coverage with continuous eligibility.”

But Balat argues, “There’s no justification for expanding Medicaid because the Texas Legislature enacted other measures that will go much further in ensuring that Texans can get the health coverage – and more importantly, the care – that they need.”

This year, Gov. Greg Abbott signed bills into law allowing the Farm Bureau and Texas Mutual to offer less expensive, targeted plans than the ACA to Texas residents. Lawmakers also expanded access to telemedicine and passed hospital price transparency laws.