As
Congress
deliberates
what
the
future
of
Medicaid
funding
will
look
like,
healthcare
executives
are
worried.
House
Republicans
proposed
Medicaid
cuts
last
month
that
would
have
sweeping
and
disproportionate
consequences
—
particularly
for
rural
hospitals
and
underserved
populations.
The
plan,
which
seeks
to
reduce
Medicaid
spending
by
hundreds
of
billions
of
dollars
over
the
next
decade,
lacks
specifics
but
could
be
implemented
through
reduced
federal
funding,
block
grants
or
stricter
eligibility
requirements.
Healthcare
leaders
warn
that
these
cuts
would
cause
uncompensated
care
costs
to
balloon,
leading
to
hospital
closures
and
diminished
care
access.
The
experts
interviewed
for
this
article
agreed
that
while
the
proposed
Medicaid
cuts
aim
to
reduce
government
spending,
the
plan
will
actually
end
up
exacerbating
the
financial
instability
of
the
overall
U.S.
healthcare
system
—
as
well
worsen
health
outcomes
for
millions
of
Americans.
Where
does
the
plan
stand?
House
Republicans
introduced
a
budget
plan
last
month
ordering
various
congressional
committees
to
find
at
least
$1.5
trillion
in
spending
cuts
over
the
next
10
years.
It
directs
the
Energy
and
Commerce
Committee,
which
oversees
Medicare
and
Medicaid,
to
reduce
its
spending
by
$880
billion
over
that
time
period.
The
GOP’s
budget
blueprint
doesn’t
outline
how
the
committee
would
achieve
this
target,
but
it’s
clear
that
doing
so
would
involve
significant
cuts
to
Medicaid.
The
nation’s
Medicaid
program,
which
provides
health
coverage
for
about
72
million
Americans,
accounts
for
one-sixth
of
all
healthcare
expenditures
and
is
one
of
the
largest
programs
under
the
Energy
and
Commerce
Committee’s
jurisdiction.
The
day
the
plan
was
released,
one
federal
budget
expert
—
Bobby
Kogan,
senior
director
of
Federal
Budget
Policy
at
Center
for
American
Progress
and
former
adviser
to
the
director
of
the
Office
of
Management
and
Budget
under
the
previous
presidential
administration
—
wrote
on
X
that
this
plan
would
undoubtedly
require
major
cuts
to
Medicaid.
“For
Energy
and
Commerce,
it’s
mathematically
impossible
to
achieve
$880
billion
in
savings
if
you
don’t
cut
Medicaid
or
Medicare.
There’s
not
enough
money
they
have
jurisdiction
over.
Republicans
say
they’re
not
cutting
Medicare,
so
that
means
they’re
cutting
Medicaid,”
he
wrote.
A
March
5
report
from
the
Congressional
Budget
Office
also
found
it
is
impossible
to
achieve
$880
billion
in
savings
without
broad
cuts
to
Medicaid.
The
House
passed
the
budget
resolution
on
February
25,
and
the
Senate
is
expected
to
vote
on
the
plan
this
month.
How
might
Congress
go
about
implementing
these
cuts?
Healthcare
leaders
certainly
don’t
have
a
sunny
outlook
about
the
budget
resolution
making
its
way
through
Congress,
but
it’s
presently
difficult
to
quantify
exactly
how
disastrous
its
effects
would
be
because
the
plan
lacks
specifics,
said
Harold
Miller,
CEO
of
the
Center
for
Healthcare
Quality
and
Payment
Reform.
There
are
several
ways
Congress
might
go
about
reducing
Medicaid
funding,
he
noted.
For
example,
lawmakers
could
lower
the
federal
government’s
share
of
Medicaid
funding,
which
would
force
states
to
either
cover
the
difference
or
slash
services.
Alternatively,
Congress
could
withdraw
federal
support
for
specific
services,
such
as
expensive
GLP-1
drugs,
which
would
shift
financial
responsibility
to
state
governments,
Miller
explained.
Another
tactic
Congress
may
choose
is
cutting
eligibility.
With
Medicaid
eligibility
reduced,
fewer
Americans
would
be
insured,
which
would
cause
a
surge
in
hospitals’
uncompensated
care,
Miller
remarked.
He
also
mentioned
block
grants
as
a
possibility.
Instead
of
covering
a
percentage
of
costs,
the
federal
government
could
provide
states
with
a
fixed
sum
for
Medicaid
—
which
would
limit
funding
growth
and
force
states
to
make
tough
decisions
about
whether
or
not
to
make
their
own
cuts.
“Many
people
have
argued
that
[block
grants]
could
give
the
state
greater
flexibility
in
terms
of
exactly
what
it
covers
and
how
it
structures
the
program.
The
concern
is,
if
Congress
decides
it’s
going
to
cut
the
overall
amount,
then
the
state
might
not
have
enough
money
to
be
able
to
provide
the
same
level
of
benefits,”
Miller
remarked.
He
pointed
out
that
Medicaid
cuts
would
likely
lead
to
many
difficult
decisions
for
state-level
leaders.
Since
Medicaid
is
a
joint
state-federal
program,
states
would
have
to
figure
out
how
to
respond
to
federal
cuts
—
whether
to
reduce
provider
payments,
get
rid
of
services
or
maintain
coverage
by
increasing
state
spending.
Care
access
and
quality
would
worsen
for
patients
across
the
board
Medicaid
cuts
would
affect
many
more
Americans
than
just
those
covered
by
Medicaid,
noted
Megan
Cundari,
senior
director
of
federal
relations
at
American
Hospital
Association.
This
is
because
the
financial
ramifications
would
force
hospitals
to
make
cost-cutting
adjustments
like
eliminating
departments
or
laying
off
staff
members
—
thereby
affecting
all
patients.
Slashing
Medicaid
funding
means
hospitals
would
deliver
more
uncompensated
care.
Fewer
people
would
have
Medicaid
coverage,
leading
to
more
uninsured
patients
unable
to
pay
for
their
services.
A
report
released
this
week
predicted
that
Medicaid
cuts
would
result
in
an
$80
billion
revenue
loss
for
providers
next
year,
due
in
large
part
to
a
spike
in
uncompensated
care
costs.
This
would
strain
providers’
finances,
and
many
hospitals
would
be
forced
to
eliminate
certain
service
lines
or
reduce
their
staffing
levels,
Cundari
pointed
out.
“There
may
be,
for
example,
longer
wait
times
at
the
emergency
department
because
there’s
just
not
as
many
staff
to
help
serve
all
the
people
that
need
to
be
served
in
the
community.
I
think
it’s
important
to
understand
that
the
Medicaid
cuts
are
not
just
Medicaid
cuts
—
and
they
will
not
just
impact
the
people
who
are
involved
in
the
program.
They’re
also
going
to
impact
entire
communities,”
she
declared.
There
are
hundreds
of
rural
and
safety-net
facilities
across
the
nation
that
rely
heavily
on
Medicaid
reimbursements
to
cover
the
cost
of
care
—
and
for
some
of
these
organizations,
a
significant
decline
in
Medicaid
payments
will
be
the
straw
that
breaks
the
camel’s
back,
forcing
them
to
close
their
doors,
added
Ben
Finder,
the
AHA’s
vice
president
of
policy,
research,
analytics
and
strategy.
When
a
rural
or
safety-net
hospital
closes,
its
patients
don’t
just
disappear,
he
noted.
These
patients
must
seek
care
at
the
next
nearest
facility,
which
is
often
a
regional
hospital
that
is
already
operating
at
capacity.
This
surge
in
patient
volume
can
overwhelm
staff
and
decrease
provider
availability,
further
diminishing
care
quality
and
access
for
all
patients
in
the
area,
Finder
explained.
Rural
hospitals
would
be
disproportionately
hurt
Medicaid
cuts
would
hit
rural
hospitals,
those
who
can
least
afford
it,
the
hardest.
For
one,
most
of
these
hospitals
operate
on
razor-thin
margins
—
research
from
last
month
shows
nearly
half
of
the
country’s
rural
hospitals
are
operating
at
a
loss.
Secondly,
many
rural
Americans
receive
coverage
through
the
Medicaid
program.
In
rural
communities,
18%
of
adults
are
covered
by
Medicaid.
In
six
states
—
Arizona,
Arkansas,
Florida,
Louisiana,
New
Mexico
and
South
Carolina
—
more
than
half
of
children
in
rural
areas
are
covered
by
Medicaid
or
the
Children’s
Health
Insurance
Program
(CHIP).
CHIP
provides
low-cost
health
coverage
to
children
whose
families
earn
too
much
to
qualify
for
Medicaid
but
can’t
afford
private
insurance.
While
CHIP
is
technically
a
separate
program
from
Medicaid,
CHIP
is
typically
managed
and
administered
in
conjunction
with
it.
Nick
Olson,
CFO
of
Sanford
Health,
called
Medicaid
“the
bedrock”
of
rural
healthcare.
Sanford
is
a
South
Dakota-based
system
operating
56
hospitals
and
more
than
270
clinics
across
several
states.
Most
of
the
health
system’s
patients
live
in
rural
communities,
Olson
said.
He
also
pointed
out
that
more
than
half
of
Sanford’s
skilled
nursing
facility
residents
are
covered
by
Medicaid.
“Hospitals
across
the
country
are
already
struggling
to
break
even,
and
this
really
puts
pressure
on
their
ability
to
reinvest
back
into
the
communities
that
they’re
serving
—
to
reinvest
back
into
increasing
and
expanding
access,”
Olson
declared.
“For
us,
in
2022
alone,
and
I
believe
more
recent
years
are
similar,
we
provided
over
$159
million
in
uncompensated
care.”
Reducing
Medicaid
funding
would
cause
that
figure
to
rise
to
an
even
more
unsustainable
level,
Olson
said.
Another
healthcare
executive
—
Alan
Morgan,
CEO
of
National
Rural
Health
Association
—
said
there
is
no
question
that
rural
hospitals
would
close
should
the
government
cut
Medicaid
spending.
“Somewhere
between
400
to
700
rural
hospitals
are
at
financial
risk
for
closure
right
now,
so
any
type
of
reduction
in
revenue
is
going
to
have
a
dramatic
impact
on
these
facilities,”
he
remarked.
Rural
hospital
closures
would
force
many
Americans
to
travel
long
distances
for
even
basic
treatments
and
emergency
care.
This
would
cause
many
rural
residents
to
forgo
routine
care,
leading
to
greater
utilization
of
emergency
departments
—
the
most
expensive
place
to
get
care
—
Morgan
explained.
This
problem
would
destroy
the
purported
intent
of
the
budget
resolution,
which
is
to
save
money,
argued
Effie
Carlson,
CEO
of
care
coordination
company
Watershed
Health.
In
other
words,
the
House
Republicans’
plan
to
cut
Medicaid
funding
aims
to
save
money,
but
it
will
likely
increase
overall
healthcare
spending.
Higher
utilization
rates
in
expensive
settings
like
ERs
and
long-term
care
facilities
will
lead
to
higher
costs
for
taxpayers,
Carlson
said.
“In
healthcare,
you
don’t
avoid
paying
for
things
—
it
just
gets
paid
for
somewhere
else
in
a
less
controllable
way,”
she
declared.
To
paint
an
even
bleaker
economic
picture,
rural
hospitals
are
often
the
largest
employers
in
their
area,
which
means
that
if
they
reduced
staffing
or
closed,
unemployment
in
those
regions
would
increase,
Carlson
added.
This
would
also
lead
to
greater
unemployment
and
reduced
tax
revenue,
thereby
pushing
rural
communities
deeper
into
economic
distress,
she
remarked.
At
first,
slashing
Medicaid
funding
may
appear
to
save
dollars
on
paper,
but
experts
agree
that
the
real
costs
are
hidden
beneath
the
surface.
When
hospitals
close
and
care
disappears,
expenses
don’t
just
go
away
—
they
get
passed
to
struggling
communities
and
overwhelmed
providers.
Photo:
Justin
Sullivan,
Getty
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