Rationing Under Trumpcare’s Medicaid Caps and Cuts: ‘Unflippingbelieveable’

Remember the outrage and criticism of the Affordable Care Act (ACA) related to “death panels.” Opponents of the ACA pointed to a provision in the bill that created an Independent Payment Advisory Board (IPAB). The Board, which has never been appointed or formed, would be tasked with examining federal spending in Medicare that exceeded a certain pre-determined level and to make recommendations to reduce spending “without affecting coverage or quality.”

The concern has been that the Medicare target was arbitrary and might led to a process where cuts would be made that would lead to the rationing of care. Legislation to repeal the provision has passed the House of Representatives and the Senate to repeal the provision with unanimous support from Republicans, but has not made its way into law as of yet.

At a town hall meeting of Rep. Gus Bilirakis (R-FL) on Feb. 11, 2017, Bill Atkins, then a member of the Pasco Republican Executive Committee, set off a screaming match by his reassertion that the ACA had “death panels.” In a statement after the town hall meeting, Atkins said:

I do not apologize for bringing the Independent Payment Advisory Board of the Affordable Health Care Act into the town hall conversation. I stand by my calling it a “death panel.” Some people may call it other terms like a potential “rationing panel” or “cost reduction panel,” but many other people beside myself have also labeled it as a “death panel,” so I am not alone in that. . .
I, and many others, call a rationing mechanism “a death panel” since it deprives citizens of lifesaving health-care through rationing. My entire purpose at the town hall meeting was to bring this to U.S. Rep. Bilirakis’ attention (I found out there that he already knew) and citizens’ attention since I believe any health care replacement bill should not contain a rationing mechanism/death panel.

Although I won’t get into whether Atkins’s assertions are correct or not here, he believes it. So, where is Atkins’s statement in opposition to the American Health Care Act (AHCA) or Trumpcare? I ask because the AHCA contains arbitrary Medicaid per capita caps and block grants, which by definition, are “rationing mechanisms.” If Atkins fears the IPAB could make recommendations, that Congress could allow those recommendations to take effect, and those changes could ration care, then he should oppose Medicaid caps because they are significantly worse.

Medicaid caps would (not could) impose $834 billion in federal spending cuts upon states and the millions of children, people with disabilities, and senior citizens the program covers without even review by the Secretary of Health and Human Services or Congress. In fact, the Medicaid per capita cap and block grant incentivize states to preemptively cut, slash, and ration care to stay below arbitrary per capita caps for children, adults, the disabled, and senior citizens.

Arguing that the IPAB could ration care, Sen. John Cornyn (R-TX) introduced a bill in the Senate to repeal the IPAB. Cornyn said:

Seniors and their families deserve to be in control of their health care decisions, not at the mercy of a board of unelected bureaucrats who think they know best.

About the IPAB, Sen. Cornyn might be right. But, shouldn’t that same rationale apply to the millions of children, pregnant women, people with disabilities, seniors and their families with Medicaid coverage who would be subjected to Medicaid caps in Trumpcare?

As noted above, per capita caps or block grants would incentivize states, state bureaucrats, or HMO bureaucrats to make billions and billions of dollars in cuts to stay below the arbitrary caps that are currently being made-up by a few select senators behind closed doors with no real understanding or foresight into health economics as to what might be appropriate health care spending levels in each and every state across the country and by different populations (children, adults, disabled, and senior citizens) years.

Ironically, many of those in Congress who have questioned the Congressional Budget Office (CBO)’s expertise on health care forecasting are supporting a process by which a few senators are trying to do the same with far less experience. Unfortunately, if these senators are wrong, even by 1 percent, the arbitrary caps they would impose could potentially shortchanges states by billions of dollars.

Even worse, the process that the House creates to enforce the caps would be an outright disaster for states and the millions of vulnerable people Medicaid covers. As an example, let’s say that these few senators reach a backroom deal in June 2017 that imposes a $2,283 per capita cap on children in a state in 2021 and $2,367 in 2022. However, due to inappropriate forecasting by the senators or an unforeseen situation, the state spent $2,500 per child, or 9.5 percent more than the arbitrarily created cap, in 2021.

This circumstance, which could happen in any or all of the states across the country, would create a serious crisis in the following year. Under the complicated mechanism set by the House bill, the federal government would force the state to pay back the overage per child in 2021 ($217 per child) and still meet the 2022 cap. Thus, the federal government would only pay the state $2,150 per capita ($2,367 for 2022 cap — $217 for 2011 overage).

Practically, the state would find itself facing a significant 14 percent cut via the per capita cap in 2022 from what they had received in 2021, even if the cause of the spike in health spending were the result of an health epidemic, a medical breakthrough to treat childhood cancer, a natural disaster, etc.

In short, the federal government would force the state to significantly ratchet down spending on children through coverage limits, benefit caps, pediatric provider payment cuts, and access to care restrictions regardless of the consequences and impact on vulnerable people. That is, by definition, an arbitrarily established and disastrous “rationing mechanism” imposed on both states and millions of people across this country.

And, let’s be clear, some of the very people that criticize government for rationing health care are the ones creating a complicated and bureaucratic rationing system with Trumpcare’s per capita caps and block grants.

So, where are the cries of “death panels” and stated opposition by Obamacare opponents to Trumpcare’s Medicaid caps? In fact, a quick rewrite of Sen. Cornyn’s statement would suffice. Maybe something like this:

Seniors, people with disabilities, children, and their families deserve to be in control of their health care decisions, not at the mercy of some arbitrarily imposed caps and cuts by federal officials with no experience in health economics but think they know best and force state officials, unelected state agency bureaucrats, and HMO bureaucrats to ration their care.

They could also take their lead from the parents of children with special health care needs who desperately worry about the lives and well-being of their children if Medicaid is cut by $834 billion.

Also, where are the pro-life groups who were so quick to argue the IPAB was a “death panel”? Under the AHCA’s Medicaid block grant option, funding would not adjust for population growth. For children, that is, by definition, babies.

Katelyn Beaty, editor of Christianity Today, is one voice from the community that has raised this point. Beaty writes:

As it stands, the AHCA would create economic barriers that make it very difficult for women to choose to bring children into the world. A health care bill that prohibitively raises the cost of bringing life into the world is not pro-life.
According to Vox’s Sarah Kliff, the AHCA would allow states to waive the requirement that health insurance companies cover “pregnancy, maternity, and newborn care.” Prior to Obamacare, 88 percent of individual health care plans chose not to cover maternity care. So it’s plausible that a majority of plans would do the same if the AHCA passed.
According to the International Federation of Health Plans, in 2013 the average US childbirth with a conventional delivery cost $10,002; with a Caesarean section, $15,240. It follows that a woman whose insurance doesn’t cover maternity care, or who depended on Medicaid coverage, is more likely to end her pregnancy because it could financially capsize her and her family.

Others who are pro-life, but have not spoken out, should. In fact, they could slightly modify something written by Sarah Palin on Facebook way back in Aug. 2009 and say something like:

And who will suffer most when they ration care? The sick, the elderly, and the disabled of course. The America I know and love is not one in which my parents or my baby with Down Syndrome will have to stand in front of [a federally-imposed] ‘death panel’ so [state or HMO] bureaucrats can decide, based on a subjective judgment of their level of productivity in society, whether they are worthy of health care. Such a system is downright evil.

Although I never imagined I would ever find myself citing a Sarah Palin quote, we live in pretty unusual times where legislation in Congress that would impose immense harm to vulnerable children is somehow viewed by some as progress. To cite a Palin term that is surprisingly appropriate for this terrible policy, “Unflippingbelieveable.”