Major changes for Medicaid coming under Trump and the GOP -AND- Trump's healthcare 'dream team': Rep. Tom Price to head HHS, Seema Verma to lead CMS

CAL/AAEM News Service at
Fri Dec 23 12:10:42 PST 2016



November 21, 2016


Major changes for Medicaid coming under Trump and the GOP






by Tami Luhby


Donald Trump likely won't let Medicaid collapse, but he will vastly change
the health insurance program for low-income Americans.


Think less federal funding, more state control, fewer participants and
higher costs for those in the program.


Here's how Medicaid works now:


Nearly 73 million Americans are on Medicaid or the related Children's Health
Insurance Program (CHIP). The programs cost $509 billion in fiscal 2015,
with the federal government shouldering 62% of the bill and states paying


Most enrollees are low-income children, pregnant women, parents, the
disabled and the elderly. Under Obamacare, low-income adults with incomes of
up to 138% of the poverty line -- $16,400 for a single person -- were
allowed to sign up in states that opted to expand their Medicaid programs.
So far, 31 states, plus the District of Columbia, have done so, adding about
15.7 million more people to the rolls since late 2013, just before the
provision took effect. (This figure includes both those newly eligible under
expansion and those who always met the criteria.)


While Democrats say the program is a vital part of the safety net,
Republicans have long criticized it as being bloated, inefficient and rife
with fraud. They want to limit the federal government's financial
responsibility, while giving states more direct control over whom to enroll
and what kind of coverage participants receive.


On the campaign trail, Trump was emphatic about having the government
provide coverage to the poor, even as he vowed to dismantle Obamacare.


"You cannot let people die on the street, ok?," he said at a CNN town hall
in February. "The problem is that everybody thinks that you people, as
Republicans, hate the concept of taking care of people that are really,
really sick and are gonna die. We gotta take care of people that can't take
care of themselves." 


But he also championed turning much of the program over to the states.
Instead of funding the program through a federal match based on enrollment,
Trump would give states a fixed amount of money, known as a block grant, and
let them administer it. His presidential transition platform calls for
maximizing state flexibility, enabling them "to experiment with innovative
methods to deliver healthcare to our low-income citizens."


Capping federal funding is also popular among Republicans on Capitol Hill.
House Speaker Paul Ryan would let states choose whether they want to receive
a block grant or what's known as a per-capita allotment, which would provide
a fixed sum based on enrollment. He would also slow the annual rate of
growth of funding.


Placing limits on federal reimbursements would end states' incentive to get
more money from Washington by enrolling more residents, and it would prompt
states to make their programs more cost-effective, said Brian Blase, a
senior research fellow at the Mercatus Center, a libertarian-leaning think
tank based out of George Mason University.


"They can come up with different ways to cover the vulnerable in their
states," he said. 


Left-leaning groups, however, say that funding caps could severely weaken
Medicaid. Block grants wouldn't allow the program to expand during economic
downturns. Medicaid enrollment soared during the Great Recession and its
aftermath, rising from 42.4 million in 2007 to 55 million in 2013. They
point to the weakening of the federal welfare program, which was turned into
a block grant in 1996. The core grant has been set at a fixed amount of
$16.5 billion since 1996 so its real value has fallen a third because of


There are many different ways to structure block grants and their growth
rates, said Diane Rowland, executive vice president at the non-partisan
Kaiser Family Foundation. The impact would depend on how tightly Congress
reins in spending.


Also, the expansion of Medicaid under Obamacare makes issuing block grants
more complicated since the program is now so unequal. she said. States that
broadened their eligibility receive a lot more federal funding and serve
many more residents. Under Ryan's plan, states that haven't expanded would
not be allowed to do so, while states that did would gradually lose the
enhanced reimbursements they receive under Obamacare to cover the expansion


(The federal government has covered 100% of the expansion population's costs
for the first three years of the program. That rate will gradually decrease
to 90% by 2020. For the core Medicaid program, the federal government
matches between 50% and 72% of a state's spending, depending on the state's
average income per capita.) 


To cope with the reduced funding, states would receive more power over their
Medicaid programs. So just what would they do with this increased


Currently, some adult enrollees have to pay small premiums or co-pays, but
that is the exception rather than the rule. Participants also face no work
requirements to get benefits.


Republicans want to change that. Ryan's plan would allow states to require
non-disabled adult enrollees to work, seek employment or participate in an
educational or training program. Several Republican governors wanted to add
work mandates to their Medicaid expansion programs, but the Obama
administration turned down their requests.


Also, states could charge non-disabled adults premiums under the Ryan


One need only look to Vice President-elect Mike Pence to get an idea of how
creative states can get. Pence, who is currently the governor of Indiana,
agreed to expand Medicaid and even offer participants the option of limited
dental and vision benefits. But, in return, enrollees must make monthly
contributions of 2% of their annual household income to an account similar
to a health savings account. 


Hoosiers who elect basic Medicaid coverage face co-pays, which could range
from $4 to $8 per doctor visit or prescription and could run up to as high
as $75 for each hospital stay.


Having Medicaid enrollees contribute to accounts or pay for medical care
provides incentives for them to take more responsibility for their health,
Indiana officials said in 2014, when they unveiled the Healthy Indiana Plan


"Reforming traditional Medicaid is essential to creating better health
outcomes and curbing the dramatic growth in Medicaid spending," Pence said
at the time. "HIP 2.0 takes consumer-driven Medicaid reform to the next
level by replacing traditional Medicaid for many in Indiana with a plan that
empowers participants to take charge of their health and to be
cost-conscious consumers."


Some 390,000 residents have enrolled in HIP 2.0, as of July. More than 90%
of those who started making monthly contributions continued to do so through
the year, according to a report commissioned by the state.




November 29, 2016


Trump's healthcare 'dream team': Rep. Tom Price to head HHS, Seema Verma to
lead CMS 



ZQbGpCdWUwSEk4PSJ9> Fierce Healthcare



by Ilene MacDonald


President-elect Donald Trump has assembled his healthcare dream team: Rep.
Tom Price, R-Ga., a longtime critic of the Affordable Care Act but champion
of health IT legislation that reduces the burden on physicians, is his pick
to lead the Department of Health and Human Services. And he selected Seema
Verma, founder and CEO of consulting firm SVC Inc., to serve as
administrator of the Centers for Medicare & Medicaid Services. 


Price, a representative from Georgia's 6th Congressional District and
chairman of the House Budget Committee, supported Trump throughout his
candidacy, arguing that the healthcare reform law had "destroyed" the
healthcare system.


Indeed, The Washington Post notes that he was a leader in Republican
opposition to the ACA and worked on several comprehensive bills to replace


"Chairman Price, a renowned physician, has earned a reputation for being a
tireless problem solver and the go-to expert on healthcare policy, making
him the ideal choice to serve in this capacity," said President-elect Trump
in a statement.


"He is exceptionally qualified to shepherd our commitment to repeal and
replace Obamacare and bring affordable and accessible healthcare to every
American. I am proud to nominate him as Secretary of Health and Human


Trump said Verma is his choice for CMS administrator because she has
"decades of experience advising on Medicare and Medicaid policy and helping
states navigate our complicated systems."


If both positions are confirmed, Trump said, Price and Verma would be "the
dream team that will transform our healthcare system for the benefit of all


Price said in a statement that he was "humbled" by the nomination and the
challenges ahead. "There is much work to be done to ensure we have a
healthcare system that works for patients, families, and doctors; that leads
the world in the cure and prevention of illness; and that is based on
sensible rules to protect the well-being of the country while embracing its
innovative spirit," he said.

Reaction splits along party lines


Unsurprisingly, reaction to Trump's choice for the next HHS secretary split
along party lines. While House Speaker Paul D. Ryan, R-Wis., said in a
Twitter post that Price is the "absolute perfect choice for HHS secretary,"
incoming Senate Minority Leader Charles Schumer, D-N.Y., said in a statement
to media outlets that Price doesn't represent what Americans want when it
comes to Medicare, the ACA and Planned Parenthood.


"Thanks to those three programs, millions of American seniors, families,
people with disabilities and women have access to quality, affordable health
care. Nominating Congressman Price to be the HHS secretary is akin to asking
the fox to guard the hen house," he said.


In addition to dismantling President Barack Obama's signature legislation,
Forbes reports that Price could slow the healthcare industry's transition to
value-based care. The 62-year-old orthopedic surgeon has opposed Medicare's
mandatory bundled payment initiatives for hip and knee replacements. He has
also criticized the implementation of the Medicare Access and CHIP
Reauthorization Act.


However, Price has also been vocal on health IT issues in Congress,
according to Politico, which noted that he pushed for a doctor-friendly
version of the law regulating the use of electronic health records. The
American Medical Association issued a statement this morning supporting his
nomination. "Dr. Price has been a leader in the development of health
policies to advance patient choice and market-based solutions as well as
reduce excessive regulatory burdens that diminish time devoted to patient
care and increase costs," the AMA stated.


Price also filed unsuccessful legislation to prevent HHS from forcing
physicians to use ICD-10 codes prior to the new code set's implementation
last year, according to Medscape.

Verma looks forward to tackling nation's "daunting healthcare problems"


Verma said she was honored by the nomination and looks forward "to helping
him tackle our nation's daunting healthcare problems in a responsible and
sustainable way."


The Indiana resident has close ties to Vice President-elect Mike Pence,
according to her bio, and designed Pence's Medicaid expansion plan, known as
Healthy Indiana Plan 2.0, and also worked with other states including
Kentucky, Iowa, and Ohio on their Medicaid expansion proposals.


Before she became a consultant, Verma worked as vice president of planning
for the Health & Hospital Corporation of Marion County, Indiana, and as the
director of the Association of State and Territorial Health Officials in the
District of Columbia.




Jeff Wells
Deputy Editor, CAL/AAEM News Service


Brian Potts MD, MBA
Managing Editor, CAL/AAEM News Service

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