Congressional Democrats Warn Against Medicaid Cuts

Congressional Democrats Warn Against Medicaid Cuts

By Rebecca Adams, CQ HealthBeat Associate Editor

Some Democratic senators and congressmen said Tuesday that they would not support a budget-reducing deal that cut Medicaid, even as one leading House Democrat acknowledged that the party will probably have to accept Medicare cuts.

“Whatever they’re talking about with Medicare, maybe there are some things we can live with,” Rep. Henry A. Waxman, D-Calif, said at a Capitol Hill event organized by consumer advocacy and union groups such as the Service Employees International Union and Families USA. “But we cannot live with any cuts in Medicaid.”

But when asked about several specific Medicare proposals that are said to be under consideration in the fiscal cliff and beyond talks — including further efforts to charge wealthier seniors more for their coverage, changes to Medigap supplemental insurance, additional cuts to providers and raising the eligibility age of Medicare — Waxman declined to endorse them.

Waxman singled out two significant Medicaid provisions gaining traction as cause for concern. He said that in order to stave off an approximately 27 percent cut in Medicare payments for physicians that is scheduled to hit in January, many Republicans are floating the idea of blocking a temporary Medicaid rate increase for physicians. In 2013 and 2014, primary care physicians are set to receive the same rates for Medicaid patients as Medicare patients. The provision was put in the 2010 health care law to address concerns that Medicare traditionally pays higher rates and primary care doctors will be needed to handle the expected influx of Medicaid patients that will join the system in 2014.

Waxman also criticized the idea of setting a per capita grant for each state participating in Medicaid, a variation on the GOP block grant idea that he said “some in our party” are floating as a way to reduce the costs of the program.

House Republicans would like to cut $600 billion over a decade from Medicare, Medicaid and other health programs.

Other Medicaid reductions that have been suggested include ratcheting down the amount of money that states can draw down in higher federal matching rates through taxes on providers, reduced funding for durable medical equipment like wheelchairs and savings in care for people who are dually eligible for Medicare and Medicaid.

The Obama administration has been amenable to some of those proposals, such as lowered provider taxes, but in recent days it has backed away from some ideas it previously proposed for cutting Medicaid. For instance, President Barack Obama previously had proposed blending the various rates for Medicaid. But on Monday, administration officials said they no longer back that idea.

The three congressmen and six senators at the event repeatedly voiced concern that Medicaid cuts would be exchanged for tax increases on the wealthy, under the logic that if the higher-income taxpayers take a hit, then lower-income should too. But the lawmakers said their key message was “hands off Medicaid.”

“In many cases, our votes are at stake,” said Sen. John D. Rockefeller, IV, D-W.Va.

The lawmakers included several high-ranking members of committees overseeing health issues, including Senate Health, Education, Labor and Pensions Committee Chairman Tom Harkin of Iowa and many of his panel members and House Budget Committee ranking Democrat Chris Van Hollen of Maryland. “Any cut in Medicaid, any cut, will be felt by our most vulnerable,” said Van Hollen.

After the press conference, Waxman said that any changes to Medicaid would indicate to governors who are weighing whether to expand their programs in 2014 that the federal government is not a trustworthy partner. The overhaul law promises that the federal government will pay all the costs in the first three years for newly-eligible people if a state expands its program and even in after that full funding phases out, the match will not go below 90 percent. “If you start changing the Medicaid program this year, then all the governors will say, ‘Well, if they change it now, maybe they’ll change it later.’ So they might want to hold back on moving forward with the Affordable Care Act,” said Waxman. “I think the administration understands the importance of Medicaid as a program to help the most vulnerable and as an essential component for the success of the Affordable Care Act.”