GOP’s Medicaid cuts could affect thousands in SC

South Carolina’s must vulnerable citizens could lose access to health care if massive Medicaid cuts proposed by congressional Republicans become law.

The American Health Care Act – President Donald Trump and the GOP House leadership’s plan to replace and repeal President Barack Obama’s signature healthcare law – would make big changes to Medicaid, the federal healthcare program for the poor.

A quarter of S.C. residents — 1.2 million of 4.8 million — now get their healthcare via Medicaid.

However, the GOP bill aims to slash federal Medicaid spending by 25 percent – or $880 billion – by 2026, resulting in 14 million fewer people enrolled in Medicaid, according to a Congressional Budget Office analysis of the bill.

The bill would cut spending, in part, by capping Medicaid’s cost for the first time ever, forcing states to cut costs or ask state taxpayers to make up the difference.

“It is going to be a phenomenal burden on the state to have to decide whether to cover sick people in the way that they need to be covered or pave roads, or fix pensions or give state employees a raise,” said state Rep. Gilda Cobb-Hunter, D-Orangeburg, the ranking Democrat on the S.C. House’s budget-writing committee.

“This is all about the federal government wanting to save a bunch of money and shifting the risk to the states, and South Carolina is one of the states that can least afford it,” said Sue Berkowitz, director of the S.C. Appleseed Legal Justice Center.

GOP plan could hit SC budget

Republicans have called for Medicaid reforms as part of a new healthcare bill, saying the program is a major driver of the federal government’s deficit spending.

The GOP plan would set limits on federal Medicaid spending based on the costs of healthcare for five different groups of people, including children, the elderly and disabled, newly eligible and other adults.

The limits would take into account how many people are enrolled in Medicaid. But they would not take into account increases in the cost of caring for them. Instead, Medicaid spending would be limited to historic levels, which actual costs would exceed as medical costs rose, said MaryBeth Musumeci with the Kaiser Family Foundation.

If a state exceeds its federal spending limit, its federal Medicaid funding would be decreased in the following year, Muscumeci said.

That reality could have a huge impact on South Carolina’s budget.

The state now spends about 15 percent of its almost $8 billion-a-year general fund budget on Medicaid, where the state foots 29 percent of the cost and the federal government 71 percent.

Already, rising costs in that program have forced legislators to put more and more money into the program each year.

In 2011-12, for example, lawmakers committed $192 million of the state’s increased revenues — of $351 million — to Medicaid, more than half the new money. In next year’s budget, the state is considering spending $47 million more on Medicaid – or 13 percent of the added revenues the state has on hand.

“Almost a fourth of our population is enrolled in Medicaid, and with that comes the increased cost, and you've seen in the last few budgets, a large portion has been dedicated to healthcare, and really we have no control over that,” said state Rep. Murrell Smith, R-Sumter, who chairs the S.C. House budget panel that oversees healthcare spending.

Options? Innovate; cut off some elderly, kids

The U.S. House is expected to take up the healthcare bill Thursday.

S.C. Director of Health and Human Services Christian Soura, who oversees the Medicaid program in South Carolina, was not available for comment late last week or Monday.

But others say the fallout from Medicaid reform might not mean less access to healthcare for poor and elderly S.C. residents.

Trump and the GOP-controlled Congress are “giving us ways to be more innovative,” said Rep. Smith. “I don't necessarily see ... less people having access.”

For example, Human Services, the state’s Medicaid agency, has started innovative programs that save money, including one that allows patients to see doctors through video conferencing, Smith said.

If forced to find more savings, the state could cut optional services provided through Medicaid, such as in-home care for people with disabilities and the elderly. The state also could cut Medicaid coverage to some children who are in families that have higher income levels than the program is required to cover.

South Carolina could go from being a "shining star" to reducing coverage for children if federal funding is reduced dramatically and lawmakers scale back coverage for kids, Appleseed’s Berkowitz said.

This story was originally published March 20, 2017 at 7:30 PM with the headline "GOP’s Medicaid cuts could affect thousands in SC."