As if Iowa's embattled Medicaid system needed more stress.
U.S. House Speaker Paul Ryan's pitch to replace the Affordable Care Act is already in trouble. House conservatives are blasting it from the right, dubbing it "Obamacare-lite." Democrats are decrying the bill's potential to strip millions of Americans of their health insurance, a claim that will next week be tested when the Congressional Budget Office issues its analysis. President Donald Trump's enthusiasm is, at best, inconsistent. Powerful lobbies representing the elderly and physicians are lining up against it. And four center-right Republicans in the Senate immediately panned it because it would end federal funding for Medicaid expansion, which 31 states have done since ACA's adoption.
It's this last point of contention in which Iowa and Illinois -- both states that expanded Medicaid -- could end up in dire financial straits. The bill, as it now stands, would end federal matching funds for Medicaid expansion in 2020, replacing them with bloc grants. The rollback is essential to pay for the hundreds of billions in tax cuts that are at the core of Ryan's bill, which even Fox News admitted would disproportionately benefit the wealthy.
Iowa's Medicaid program is already in free-fall after last year's privatization. Recent filings from two of the three providers, showing huge financial losses, is evidence that Gov. Terry Branstad should have listened to federal regulators last year and applied the brakes. The third company has said in the past that Iowa's payments simply aren't enough to make it whole.
Medicaid in Iowa is already nearing a tipping point.
And it's within this ecosystem where Ryan, and to a lesser extend Trump, find themselves. Illinois Gov. Bruce Rauner, a Republican, admitted as much when he immediately panned Ryan's bill after last week's rollout. Illinois "won't do very well," under the House draft, Rauner told the Chicago Tribune. Rauner's comments echoed Ohio's GOP governor, John Kasich, who recently lobbied the White House to salvage the Medicaid funding.
Branstad, who is set to accept a diplomatic job with the Trump administration, was more, well, diplomatic. Branstad, also a Republican, said he wanted to read the bill before commenting.
The fact is, Iowa's Medicaid system has more than doubled since the state expanded Medicaid to include those making up to 138 percent of the poverty level, or $26,000 for a family of three. About 70,000 relied on the program prior to 2013's state expansion, a Department of Human Services spokeswoman told us. Now, between 145,000 and 150,000 Iowans are in the program on any given week. That's 5 percent of the state's population now relying on Medicaid. In Illinois, 650,000 were added after Medicaid expansion.
Does anyone actually believe that, when the federal funds dry up, the state is going to let those people languish? Lawmakers could, but it would be cruel and politically problematic. And, as that population again flees to emergency rooms over primary care, everyone will pick up the tab.
Ryan and Trump are feeling it from all sides. Both men made huge promises, after Republicans spent years lampooning President Barack Obama's premier domestic achievement. House Republicans ceremonially voted dozens of times to repeal the law while Obama was in office. And now, House conservatives -- especially the Freedom Caucus -- are looking to make good on pledges to kill the troubled program once and for all. Meanwhile, the GOP's center is rightly fretting the human and political costs that could accompany such aggressive and swift action.
A lot has been said about ACA's shortcomings. A lot was done to assure Obama's health insurance program failed. A lot has been promised to voters, many of them benefiting from the ACA.
But, as it now stands, states like Iowa and Illinois stand to pay if Ryan gets his victory.