New Proposed Rule Threatens the Future of Medicaid

The Trump administration’s most recent attack on Medicaid could hit New Jersey harder than any other state in the nation. Quietly released in July, the proposed rule change would reduce access to medical care for up to 1.7 million seniors, children, people with disabilities and low income workers who must rely on this program as their only source for health coverage. The proposal would repeal the current requirement for states to monitor whether the Medicaid reimbursement is sufficient to ensure enough doctors are participating in Medicaid to provide adequate access to medical services. This will create a major incentive for states to cut reimbursement levels and divert those savings to other state projects unrelated to health care. 

The proposal is a greater threat in New Jersey because the state already has the lowest percentage of doctors in the nation who are willing to participate in Medicaid (39 percent), and it’s reimbursement for all services, as a percentage of the Medicare rate (65 percent), is ranked second lowest in the nation. The proposal will harm most health care providers, but it could have an even greater impact on hospitals because the research shows that when consumers have less access to primary care, they end up in the emergency room and drive up charity costs which impacts everyone.

Unfortunately, this is another example of the Trump administration taking administrative action to enact unpopular policies rejected by Congress. The Trump administration has already approved waivers for states to cap Medicaid funding and enacted draconian work requirements, the latter of which has already reduced enrollment substantially even for people who work. The administration has also asked states to submit proposals to block grant Medicaid, even though that was specifically opposed by Congress as part of legislation to repeal the Affordable Care Act. Unless Congress or the courts overturn this rule and previous administrative actions, the future of the entire Medicaid program is under threat.

Consumers and providers who are concerned about this proposed rule must have their comments in to the Centers on Medicare and Medicaid Services by September 13, after which the administration can make it final.  

Proposed regulation text:
https://www.federalregister.gov/documents/2019/07/15/2019-14943/medicaid-program-methods-for-assuring-access-to-covered-medicaid-services-rescission