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Medicaid Is A Key Component Of An Obamacare Replacement Bill: What Are The Issues

ArmchairPolitiicianObamacare, April 24, 2017, by Brad Peery, ArmchairPolitician.US

Medicaid is the second largest healthcare entitlement program. Under the Affordable Care Act (ACA or Obamacare), 31 states started Medicaid programs, and 19 states decided not to start Medicaid programs. To participate in the program, states contribute about 40% of the cost of the program. The program covers individuals and families with incomes up to 138% of the poverty level.

The House GOP Obamacare replacement plan indexes benefits to 1% plus the “chained consumer price index”, which generally is lower than the CPI. Under its plan, starting on January 1, 2020, the federal government will begin to reimburse the states at a lower rate. The states would get block funding based upon the size of their Medicaid populations, and the states would get some flexibility as to how they spend the money. Consideration is also being given to sending more money to states that did not adopt Medicaid by sending money to hospitals that provide services to more Medicaid and uninsured patients. Consideration is also being given to providing funding to doctors in states that did not adopt Medicaid.

An important change to Obamacare might be to introduce a work requirement. Other changes might be emergency room co-payments, and premiums. The states only control about 5% of the current programs, and giving the states more control is being discussed. Also being discussed is giving waivers to states that want to introduce innovation into their programs. The individual payments might be indexed to the medical component of the Consumer Price Index. Tom Price, the Secretary of the Department of Health and Human Services also has the ability to make administrative changes. This is the second phase of a GOP three-phase Obamacare repeal and replacement plan.

Obamacare covers 70 million people. It is forecasted that 24 million will lose their coverage due to cumulative reductions of $800 billion by 2026. The states are sent funding based upon the amount they spend. This amounts to an open-ended entitlement. Under the GOP bill the states will not be able to expand their Medicaid programs, beginning in 2020, meaning that there will be no additional Medicaid enrollees thereafter.

ArmchairPolitician.US Opinion: Medicaid is the most important component of an Obamacare overhaul. Many governors of Medicaid states strongly support the program. It will be important whether an overhaul of the program will make it more effective, expand some coverage to non-Medicaid states, adopt a work requirement for those capable of working, and encourage doctors to provide services to Medicaid patients.

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