Study: 44 Million Could Lose Medicaid Coverage Under GOP Plan‎

BY Betty Ann Bowser  May 10, 2011 at 5:25 PM EDT

A new study released Tuesday by two nonpartisan organizations added new fuel to the debate over debt and spending when the report found that debt reduction proposals by House Republicans lawmakers could leave up to 44 million more low-income and disabled Americans without health insurance. Currently, about 45 million Americans are uninsured.

The analysis was done by the Kaiser Family Foundation’s Commission on Medicaid and the Uninsured and researchers at the Urban Institute.

The federal health care reform law passed last year provides for a major expansion of the Medicaid program in 2014, making almost anyone earning 133 percent of the federal poverty level eligible for the government’s health care safety net. For an individual, that equates to a salary of about $14,500 a year.

But House Republicans, led by Rep. Paul Ryan of Wisconsin, who is Chairman of the House Budget Committee, want to change the way the federal government takes care of those who are poor and have medical needs, changing the program into a “block grant” system. States would be given a set amount of money to provide health care for low-income Americans and would also have more flexibility in the way benefits are allocated. Supporters of this approach to reduce the deficit say it would save the taxpayers more than $1 trillion dollars over 10 years.

Connor Sweeney, communications director for the Republicans on Ryan’s House Budget Committee, called the Kaiser study “misleading.” He said under Rep. Ryan’s so-called Path to Prosperity, Medicaid will continue to grow but at a “sustainable rate.”

Connor added the Kaiser report makes “false assumptions” that were “never detailed in the budget” passed by the House last month. That budget included Rep. Ryan’s plan to change Medicaid.

Diane Rowland, executive vice-president of the Kaiser Family Foundation, disagreed.

She said that under the GOP block grant plan states would lose their ability to provide coverage “substantially” to low-income Americans. If Republican lawmakers in the House were successful, Rowland said, it would “add millions more to the number of uninsured Americans and compromise Medicaid’s role as the health safety net.”

The report found that cuts to states would vary widely, but the analysis showed the greatest impact would fall on southern and western states which have not increased their safety net recently.

Republican governors facing massive state budget deficits generally support Ryan’s Medicaid block grant proposal, and have asked the federal government for more flexibility in the way they administer the program in their states. In a letter to Ryan last month, they said his proposals were “far superior” to anything contained in the federal health care reform law passed last year and signed by the president.

Democrats in both the House and the Senate oppose his plan. President Obama has said he would veto any such measure if it comes to his desk.

Medicaid is a joint federal and state program. Currently, Washington pays almost 60 percent of the cost, with the states picking up the rest. It is also a major source of federal dollars for the states.

The report also found that hospitals would also lose money under the Ryan plan. According to the study, federal government payments to facilities caring for Medicaid patients would drop by as much as 38 percent. That could total as much as $84 billion dollars by 2021 — at a time when growing numbers of uninsured Americans would be going to the emergency room for treatment.

Find more coverage on our health page.