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Op-ed: What Does the Senate’s “Repeal and Replace” Bill Mean for Utah?

"In order to make sure that we have enough quality doctors taking Medicaid patients, we need to pay them appropriately for their services."
"In order to make sure that we have enough quality doctors taking Medicaid patients, we need to pay them appropriately for their services."
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Let’s set aside the political drama for a moment and focus on some bitter facts: Utah has more to lose than many other states if the Senate’s “Repeal and Replace” bill passes.

Utah runs a notoriously lean Medicaid program, which is nonetheless a lifesaver for low-income children, low-income seniors, persons with disabilities and pregnant women who rely on it for health care. The Senate’s bill would cut Medicaid by nearly $800 billion, snatching health care away from millions of vulnerable Americans and removing the considerable incentives states had to expand Medicaid for the working poor. Are the cuts being used to shore up the overall health care system? No. They are used to give generous tax cuts to wealthy individuals and corporations.

But the problems go deeper. The Senate bill makes structural changes to Medicaid which haven’t gotten a lot of attention, but which have serious implications. The bill proposes a strict limit on the amount of money that the federal government will contribute to each individual Medicaid beneficiary’s health care.

This approach basically turns Medicaid into a “dollar store” for health care. You can have anything in the store that you need, as long as it only costs a dollar. A new product may come along that will last longer or save on other expenses down the road — sorry, it costs more than a dollar.

Here‘s the rub: Utah is one of 11 states with the lowest spending per enrollee. The current financing arrangement, where the Feds cover about 70 cents on every dollar, allows Utah to cost-effectively address situations that arise from unusual disruptions like a natural disaster or epidemic.

Down the road, Utah may decide to devote more state Medicaid funds to certain health services in order to save money in other areas. Take opioid treatment: The longer individuals remain addicted to opiates, the greater damage they do to their bodies and lives, and the greater a burden they place on state services (like emergency medical treatment for overdoses, long-term disability, criminal justice spending and social services for the families left behind). Medicaid dollars spent on treating addiction can prevent these tremendous downstream costs. It will be up to Utah to make these decisions, given that the federal spending cap will shift so much of the Medicaid burden to states.

Then there is the issue of provider reimbursement. In order to make sure that we have enough quality doctors taking Medicaid patients, we need to pay them appropriately for their services. But if Utah decides to increase provider reimbursement (which we have debated extensively in the past), this additional money will have to come entirely from our own state budget. The federal spending cap remains firmly in place. Of course, some people might argue that it’s perfectly appropriate for the independent “beehive” state to shoulder the burden of Medicaid costs and make our own decisions about how to spend our Medicaid dollars. But the amount of federal money that the Senate bill proposes to cut would increase state costs so dramatically that Utah would quickly exhaust our own resources paying for the most basic services. We would lose the flexibility we have had in the past to tailor state Medicaid spending for local needs.

Finally, and most importantly, is the matter of ethics on these decisions. Is it consistent with Utah’s values to snatch health care away from poor children, people with disabilities, seniors and their families in order to give a generous tax break to wealthy individuals? All Utahns need to answer this question for themselves.

Judi Hilman is the President of Policy Catalyst.