People who have health insurance through the Medicaid expansion are at great risk of losing their coverage if the Senate passes the House health bill, a decision that would greatly harm rural America, says a Center on Budget and Policy Priorities report.
Republican senators have said they are "starting from scratch" and writing their own bill, but that is misleading, said Shannon Buckingham, spokesperson for the liberal-leaning group. "Make no mistake, the House bill's core provisions remain firmly at the center of Senate discussion."
Nearly 1.7 million rural Americans have health insurance through the Patient Protection and Affordable Care Act's expansion of Medicaid to those who earn up to 138 percent of the federal poverty line, about $33,000 for a family of four. Of the 470,000 who have coverage through the expansion in Kentucky, an estimated 224,000 are in rural areas.
The report says the House health bill, called the American Health Care Act, would "effectively end" the Medicaid expansion because "beginning in 2020, states would receive only the regular federal Medicaid matching rate . . . for any new enrollees under the expansion instead of the permanent expansion matching rate of 90 percent." The matching rate for Kentucky is 70 percent, so the state would have to pay 2.8 times more than under current law for each new enrollee, the report said.The bill also allows states to stop enrolling people in expanded Medicaid.
For people who don't qualify for Medicaid, the House bill would raise health-care costs by reducing tax credits that help low income people pay for premiums and out-of-pocket costs; would allow states to take away protections for pre-existing conditions; and cut taxes by more than $600 billion over 10 years, mostly for the top 1 percent of income earners.
The detailed CBPP report, which offers state-level details on many measures, found that in at least eight expansion states, including Kentucky, more than one-third of expansion enrollees live in rural areas.
Gov. Matt Bevin has said Kentucky can't afford to pay for its expansion population and has applied for a waiver that would let the state charge small, income-based premiums and would require "able-bodied" recipients to either work, volunteer or take job training, among other things. These changes are expected to make the state's Medicaid rolls have 86,000 fewer people in five years than they would otherwise. The waiver is expected to be approved in June and to go into effect Jan. 1.
"While those numbers may seem abstract, they have tangible impacts on access to care, on health and to financial security," Mary Wakefield, former acting deputy secretary for the U.S. Department of Health and Human Services, said. For example, she said the rural states of Kentucky and Arkansas, which expanded Medicaid, saw a "one-third increase in the share of low-income adults getting regular check-ups and a two-thirds decrease in the share depending on the emergency room for care."
The report adds, "In Kentucky, state data show tens of thousands of low-income individuals have received cholesterol, diabetes and cancer screenings, and preventive dental services," as a result of expanding Medicaid.
"The House health bill is a threat to rural hospitals," said Jesse Cross-Call, a senior policy analyst at CBPP and co-author of the report. "Over the past few years, closures of rural hospitals around the country have been heavily concentrated in states that have not expanded Medicaid,"
The report says, "Most of the 78 rural hospitals that have closed since 2010 are in Southern states that haven't expanded Medicaid" and "uncompensated care costs as a share of hospital operating budgets fell by about half between 2013 and 2015 in expansion states."
Cross-Call added that the expansion had created a "pathway to health coverage where before the ACA one often did not exist," noting that people who live in rural areas often have lower incomes, have more contract work and are less likely to have an employer that offers health coverage, than non-rural areas.
Tara Straw, senior policy analyst at CBPP and co-author of the report, said rural Americans will be harmed if the new health plan removes the ACAs "generous and flexible" tax credits and replaces them with credits that would be worth much less.
Straw said ACA tax credits are often higher in rural areas because the cost of insurance tends to be higher, due to low population density, a limited number of providers and little competition among insurers. She also noted that people who live in rural areas tend to be older and have lower incomes.
"Because the ACA's credit is based on the cost of an actual plan, and not a fixed dollar amount, it helps protect people from premium increases," she said. For example, the AHCA tax credit for a West Virginia enrollee would be less than half of what an ACA credit would be, $7,400 compared to $3,100, for a plan that covers less, she said.
The House bill would provide a flat tax credit varying only by age: $2,000 for people under 30; $2,500 for people age 30 to 39; $3,000 for people age 40 to 49; $3,500 for people age 50 to 59; and $4,000 for people age 60 and older.
Straw explained that while the House bill allows for a tax credit for a 60 year old to be twice as high as for a young adult, it also allows older adults to be charged five times as much.
The House bill would also repeal the ACA's cost-sharing subsidies, which are available to people with incomes below 250 percent of the poverty line and allow them to purchase coverage with lower deductibles and covers other out-of-pocket costs.