SAN FRANCISCO – Hospitals serving low-income people are relying on politics to save them from dramatic reimbursement cuts under Obamacare repeal.
Executives at the JPMorgan Healthcare Investor Conference here used much of their 30-minute presentations and breakout sessions to lay out their case for why Republicans shouldn’t roll back the Affordable Care Act’s Medicaid expansion as they seek to erase parts of the healthcare law.
But while the hospital leaders stressed a troubling uncertainty over how things will play out, they also expressed confidence that Republicans won’t quickly and dramatically roll back Medicaid benefits, especially before the next election.
“I think the number one consideration is the fact that there is a midterm election coming in November 2018,” said Wayne Smith, CEO of Community Health Systems, a network of 160 hospitals chiefly in non-urban areas.
The healthcare law allowed states to expand Medicaid to cover Americans earning up to 138 percent of the federal poverty level, representing a dramatic expansion of the program in some areas. While 19 states have opted out of expansion, dampening enrollment overall, more than one-fifth of all people now rely on Medicaid for their health coverage.
It’s exceedingly rare for Congress or the federal government to roll back a safety-net program like Medicaid expansion once it’s in motion. And only a few states have ever scaled back parts of their Medicaid programs. Republicans know it would be politically dangerous to do that now, and that’s giving hospitals some hope.
“I don’t think you’re going to see anything too dramatic in the relative near future,” Smith said. “Political decisions are more important than other kinds of decisions in Washington.”
Steve Corwin, chief executive of New York Presbyterian Healthcare System, noted that a number of Republican governors chose to expand Medicaid. “I think those governors seem to be reluctant to roll it back,” he told the Washington Examiner.
“You have 70 million patients on Medicaid,” he said. “You gotta be really careful about what you’re doing.”
The problem for some hospitals isn’t just the patients who would become uninsured should Medicaid be rolled back. It also means cuts to states with more generous Medicaid programs before the healthcare law, which were getting extra payments for those patients.
In New York, that translates to several billion less in federal Medicaid dollars, which lawmakers have said would put a big hole in the state’s budget.
“That’s going to affect the Medicaid allocation for all patients,” said Corwin, whose company operates hospitals in Manhattan and the New York suburbs.
Hospital and insurance executives said they’re deploying lobbyists to push their message on Capitol Hill — and insisted they’re getting assurances that lawmakers are taking them seriously.
“What we’re hearing is it’s less likely there’s going to be dramatic cutting off of those added to the Medicaid rolls,” said Ken Burdick, chief executive of Medicaid health insurer Wellcare.
LifePoint Health CEO William Carpenter said he senses a gravitas among lawmakers.
“I’ll tell you I have found the tone, the mood, in Washington to be very measured,” said Carpenter, whose Tennessee-based hospital network includes 72 centers in rural communities. “No one high-fiving in the halls of Congress that we’ve won.”
A healthcare proposal released by House Speaker Paul Ryan. R-Wis., calls for gradually phasing down the extra Medicaid spending and generally giving states more leeway in how they run their programs. It also calls for block grants, an idea generally disliked among the industry.
But neither Ryan nor Senate Majority Leader Mitch McConnell, R-Ky., have said how the final Obamacare replacement measure will handle Medicaid expansion or whether it will try to change the Medicaid program overall.
To hospital executives, the worst-case scenario is if Congress repeals Obamacare without replacing it. The best-case scenario: Congress leaves Medicaid expansion in place and gives states even more latitude in alternate ways of implementing it through the waiver process.
“The best case is that Trumpcare looks something like the program that we have in place that could be tweaked in order to make it better,” Carpenter said.
But as Republicans work toward passing a repeal bill, amid heavy pressure to include an Obamacare replacement, industry leaders admit that things can change quickly on Capitol Hill and no one knows how it will shake out.
“I’ve been asked all day long about the Affordable Care Act, and I’ll give the same answer to you,” Smith said. “I have no clue, and I don’t think anyone else does, either.”
