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Repealing Medicaid expansion is deadly

February 10, 2017
by Joe Parks
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When we hear about the national epidemics of suicide and opioid misuse, what many don’t realize is that Medicaid covers more than a quarter of the behavioral health services necessary to help protect those most endangered by these epidemics.

That’s why the current discussion on Capitol Hill to roll back the Affordable Care Act (ACA), including expansion of Medicaid, is a lot like cutting back the number of fire fighters deployed to contain a raging forest fire. It’s not a way to succeed. Instead, we would expect to see more deaths.

My experience has taught me that most of the general public—as well as those in office who want to diminish the Medicaid program—understand neither its scope, nor the actual populations it covers. They think of it as a program that takes care of lazy people who aren’t motivated to work.

Yet, in addition to covering persons with mental illness and behavioral health concerns, in traditional (pre-ACA) Medicaid, three-quarters of Medicaid recipients are families, about half of all births are paid for by Medicaid, and other large groups include elderly and disabled persons.

Medicaid populations

The Medicaid expansion populations now covered under the ACA are mostly low-income workers. This younger age group needs care for substance use disorder and other mental illnesses such as depression and anxiety. Since passage of the ACA, nationwide rates of unemployment in those covered by Medicaid have steadily decreased, and states that expanded Medicaid have seen lower rates of defaults on car loans, credit card debt and personal bankruptcy.

I believe there is a direct correlation. If we’re not going to treat people’s mental illness, and we’re not going to treat their addictions, we should expect to see a reversal in these employment gains, as well as an increase in suicides and opioid misuse.

Sometimes, people want to have simple answers. Often, things just can’t be made simple. Medicaid is a large, complicated program. Cutting the Medicaid expansion and replacing it with block grants and spending caps, as is widely being suggested in Congress, is tantamount to saying that rather than do their job as elected officials, they are willing to walk away from doing the hard work necessary to manage the complicated program that protects our nation’s most vulnerable, especially those at the heart of our nation’s two deadliest epidemics.

Because caps allow the federal government to cut its support after a certain point, that is precisely what happens; whether a state is willing or able to continue funding Medicaid is not guaranteed. The result is that people grow sicker faster, and remain sicker longer. How does that save money? Why is that a good idea, to let our nation’s citizens suffer unattended?

Puerto Rico’s example

We already have an example of what a catastrophe block grants and caps would turn out to be. In the mainland U.S., the federal government pays a matching rate of each state’s Medicaid costs based on their respective per capita income, generally 50% to 75% of the costs depending on the state. However, Puerto Rico’s federal funding has been capped since the late 1970s. As a result, their matching rate is now 15% to 20% federal share. Any costs above that amount are left to the island’s local government to cover, effectively lowering the matching rate by as much as a third.

However, because rates of chronic illness in Puerto Rico skew high—fueled in part by poverty and high rates of unemployment—and a spiraling financial crisis made worse by the impact of the Zika virus, has meant island-wide shortages of care due to lack of funds.

In states like West Virginia and New Hampshire where opioid-related deaths continue to escalate, we should think of suicide and opioid overdoses like the Zika crisis in Puerto Rico: Capping matching federal dollars will only imperil what help states are already struggling to provide. 

If Congress truly wants to cut the cost of care, some of our greatest savings would come from reducing the horrendous inefficiencies created by non-standardization. In most of the developed world, the average cost of billing and coding for healthcare services is, on average, about half of what it costs in the United States. In the U.S. it’s 7.1%, while the average of the 10 other developed nations is 3.5%. The U.S. is the most inefficient by multiple performance measures. 

Streamlining the current multitude of forms and processes would take hard work and require integration of information technology and standardized forms, people would complain that the federal government is interfering with their business, or that it’s too costly. What they’d really be saying is that their administrative inconvenience—which would only be temporary—is more important than the actual pain of those who have nowhere to turn for help treating their illness. 

Congress should do the hard work of reducing bureaucratic bloat, both governmental and commercial, not services. Instead, our leaders seem ready to dump it on the states, wash their hands and say, “good luck!”

Some might call that flexibility, but I call it a lack of responsibility. And in the midst of our suicide and opioid abuse crises, it’s also deadly. 

Joe Parks is senior medical director for the National Council for Behavioral Health and is formerly the director of Missouri’s Medicaid authority in Jefferson City, as well as the former medical director of the state’s department of mental health and its Medicaid program.

This perspectives article was contributed courtesy of the National Council for Behavioral Health.