It’s Official: Senate Health Plan Slashes Medicaid Deeper Than House

The U.S. Senate on Thursday released the long-awaited details of its Obamacare repeal plan, confirming rumors that it would see the House’s plan to cut Medicaid spending and raise it — potentially spelling trouble for skilled nursing operators.

Medicaid remains the single largest payer for skilled nursing services in the United States, shelling out $55 billion to SNFs in 2015 according to a recent analysis from the Kaiser Family Foundation. Six in 10 nursing home residents in the United States use Medicaid to pay for their care, Kaiser found.

Like the House version of the American Health Care Act, the Senate’s plan would require states to pick either a block grant or a per-capita cap scheme for Medicaid spending, essentially providing a flat rate for each Medicaid recipient based on his or her age or care needs.


But unlike the House bill, which would gradually raise funding over time based on the Consumer Price Index for medical care (CPI-M), the Senate plan would switch to the general Consumer Price Index for all urban consumers (CPI-U) after 2025 — all but guaranteeing even steeper cuts to Medicaid funding for states, as the CPI-M has increased significantly faster in recent years than the CPI-U.

For comparison, the House’s more generous Medicaid rate would still lead to $800 billion in cuts by 2026.

Various health care groups have expressed deep concern over how the House plan would affect seniors who receive health care through Medicaid: AARP crunched the numbers and determined that the growth rate won’t match the needs of an aging U.S. population, and Kaiser claimed that a cap system could deepen the already wide gulf in Medicaid SNF spending among states, while also potentially forcing operators to cut staff and provide lower-quality care.


Reactions to the Senate plan — dubbed the “Better Care Reconciliation Act” — spanned the usual gamut, with administration officials applauding the legislation as a win, and health care groups railing against the cuts inherent in the bill.

LeadingAge — a non-profit organization that represents a variety of aging-care providers — has already lodged its opposition to Congress’s Medicaid plans and issued a brief statement critical of the law.

“LeadingAge continues to strongly oppose the fundamental changes to the Medicaid program made by both the House and Senate legislation repealing the Affordable Care Act,” President and CEO Katie Smith Sloan said in the release. “These cuts and caps on Medicaid have the potential to hurt every American family.”

Seema Verma, administrator of the Centers for Medicare & Medicaid Services (CMS), has a background in Medicaid policy, having designed Indiana’s expansion of the program under the Affordable Care Act. She also has been critical of Medicaid generally, saying that the “status quo” is not acceptable.

“The Senate proposal is built on putting patients first and in charge of their health care decisions, bringing down the cost of coverage and expanding choices,” Verma said in a statement Thursday. “Congress must act now to achieve the President’s goal to make sure all Americans have access to quality, affordable coverage.”

Sen. Mitch McConnell, the Kentucky Republican who serves as Senate Majority Leader, used his statement to blast the effects of Obamacare and presented his version of Trumpcare as a way to liberate American workers and employers from its mandates. The lengthy statement only made a single mention of Medicaid, in a longer passage about the areas over which Republicans — who have been reportedly divided between centrist skeptics who object to the cuts, and conservatives who don’t think the repeal will go far enough — found agreement.

“We also agree on the need to strengthen Medicaid, preserve access to care for patients with preexisting conditions, and allow children to stay on their parents’ health insurance through the age of 26,” McConnell said.

McConnell’s Democratic counterpart, Senate Minority Leader Sen. Charles Schumer of New York, proclaimed the bill to be “every bit as bad” as the House version, according to multiple reports.

“The Senate Republican health care bill is a wolf in sheep’s clothing,” Schumer said on the floor of the Senate. “Only this wolf has sharper teeth than the House bill.”

Even former President Obama entered the debate, taking to Facebook for the first time since he left office to post a criticism of the bill and call on the Senate to take a different path when amending his administration’s centerpiece health care law.

“Simply put, if there’s a chance you might get sick, get old, or start a family — this bill will do you harm,” Obama wrote.

The CBO plans to issue its scoring of the bill next week, and Senate Republicans hope to pass the legislation before Congress takes its July 4 holiday recess. The GOP currently holds a 52-48 advantage in the Senate.

Democrats are expected to unanimously oppose the legislation, but as of Thursday afternoon, four Republican senators — Ted Cruz of Texas, Ron Johnson of Wisconsin, Mike Lee of Utah, and Rand Paul of Kentucky — said they wouldn’t vote for the bill as it is, claiming it doesn’t go far enough in repealing Obamacare.

Written by Alex Spanko

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