A recent editorial in the NY Times, titled The Ryan Plan for Medicaid, describes why the House Republicans' plan to radically restructure Medicaid would be very bad for states and ultimately Medicaid consumers. The editorial does a good job of explaining the proposed changes to the existing Medicaid program, why these changes will ultimately shift more of the financial cost of health care from the federal government to the states, and how this will inevitably lead to states cutting even more services and provider reimbursement.
As bad as this is, Ryan's plan would further threaten access for vulnerable Medicaid consumers in another way - by undermining the legal rights that Medicaid consumers and providers have to challenge the state cuts that are likely to occur.
The Ryan plan proposes to change the Medicaid program into a block grant program that would create stricter limits on the money states get, but grant states greater discretion with respect to the amount and type of benefits, services, and reimbursement provided. We've already seen how states routinely disregard legal requirements under the existing Medicaid program. At least now providers and beneficiaries have legal recourse to halt illegal Medicaid cuts that threaten health care access and quality, and they have done so successfully.
Public programs that are administered through block grants typically have fewer clear legal requirements imposed on states to ensure that federal money is spent in ways that ensure equal access and quality care. In addition, these kinds of programs may not give beneficiaries the ability to sue to enforce these requirements or prevent illegal state action. In fact, we see examples of this in the way the Children's Health Insurance Program (CHIP) has been created and administered.
In 1997, Congress created CHIP under Title XXI of the Balanced Budget Act to provide insurance for uninsured children in families whose income was not low enough to qualify for Medicaid. The law allowed states to use federal funding to simply expand existing Medicaid coverage, create a new and separate CHIP, or create a combination of both a separate program and an expanded Medicaid program. Many states chose to create a separate CHIP, which not only maximized their flexibility with respect to program design, but also gave them the ability to limit beneficiary due process protections and eliminate the right of providers or beneficiaries to challenge programmatic decisions that violate federal requirements.
Greater flexibility and discretion for states in the administration of public insurance programs tends to mean less federal oversight, less consumer protection, and less accountability to the public. The current battle over illegal state cuts within the existing Medicaid program shows that what is needed is greater oversight and legal protection for Medicaid consumers, not less.
- For more information about successful legal challenges to Medicaid cuts, you read my prior post States Cannot Ignore Federal Role in Medicaid Program.
- For more information on consumer protections in the CHIP program, you can go the National Health Law Program website on CHIP and read The State Children's Health Insurance Program: An Analysis of Due Process in State Programs.
