Medicaid “Innovation” Just Another Word for Cuts

Last month, the Trump Administration issued guidance that will allow states to shift Medicaid program funding to block grants. Under the guise of “innovation,” the Centers for Medical Services (CMS) proposal gives states the green light to indiscriminately cut the Medicaid program, with no oversight and no consequences.

As with most health policy ideas that the Trump Administration proposes, we already know how this story ends. The proposed “Healthy Adult Opportunity” is only one of the latest attempts in a years-long coordinated effort to overhaul Medicaid as we know it.

In addition to efforts to repeal the Affordable Care Act (ACA) through Congress and the Courts, and the slash and burn Trump proposed budget which lays out huge cuts to Social Security, Medicare, Medicaid and the Children’s Health Insurance Program (CHIP), the new CMS proposal will provide yet another way to dismantle Medicaid, leaving the 72 million people who depend on Medicaid — children, seniors, people with disabilities, working people — in the lurch without access to health care.

We know that the Administration’s most recent suggestion to let states “innovate” and be “flexible” with Medicaid block grants is code for cutting or eliminating public benefits altogether. It’s also a way to balance state budgets on the backs of low-income state residents. No matter how CMS spins it, block grants will squeeze state budgets and force deep cuts to Medicaid programs — and many (mostly low-income) people will bear the burden of those cuts.

The fact of the matter is – we don’t need a new experiment with Medicaid. The Medicaid expansion to low income adults under the ACA has already been proven to be successful. Findings from over 320 studies show state Medicaid expansions linked to substantial gains in health coverage, financial security, improvements in health status, and economic benefits for states and providers.

Moreover, like other recent Medicaid work requirement policy proposals by the Trump Administration – their strong desire to make it harder for low-income people to access public benefits through “state flexibility” does not make them less poor. Indeed, it only deepens their poverty.

Reductions in public benefits usage, such as Medicaid should not be our measure of success – only real reductions in poverty rates should serve as the measure by which we judge the validity of poverty-fighting policies.