Mitchell & Mitchell on Health Care and the Trump Agenda, Part 15: Design Failure for Medicaid Program Reform
This is Part 15 in an ongoing series regarding changes in health care that may take place—and actual changes that do take place—with the Trump administration. The likely implementation issues to be encountered for both potential and actual changes are described, based on detailed methods of analysis. The emphasis is on what these shifts mean for legal practices and how attorneys may prepare in the most effective ways.
The design strategy for Medicaid reform has been fundamentally flawed, challenging the Trump administration and Congressional Republicans’ ongoing efforts to “repeal and replace” the Affordable Care Act (ACA).
The proposal has failed to recognize that large program changes will always be accompanied by reactions from those affected and that advance strategies must be developed to deal with these reactions. Otherwise, negative reactions may easily stymie any efforts to introduce change.
The inherent nature of such reactions to proposed program changes have been discussed throughout this series of blog posts.
The Medicaid reform proposal has outlined plans to cap Medicaid payments by the federal government, simplify the financial structure of the program and increase the flexibility given to states to design program variations that best meet their needs.
These themes have been expressed by the White House budget plan for 2018, which may be found under “2018 Major Savings and Reforms” on page 146 (Reform Medicaid). It is critical to note that the justification for Medicaid reform has been based on vague, long-term considerations that are not immediately relevant to the public, while the proposed cost-control changes have been specific, immediate and easily assessed. This design has weakened the proposal.
Unsurprisingly, the public, health care interest groups and health care providers have all come out strongly against the proposed reform. Advocates of reform have been forced to fall back on justifications that seem far removed from the real-world situations facing most people.
The proposed reform would create a specific negative impact—less money for care—without any counteracting advantages that can be easily understood. Negative reactions have been intense and ongoing, should easily have been anticipated and could have strengthened any proposals.
The justification for these changes has failed to provide any specific, immediate proposed activities that would have a positive impact on those affected. Vague cost savings for the future and the possibility for more flexibility and adaptability are weak and inadequate grounds for support.
This experience illustrates the larger policy problems facing all efforts to change programs that have a vested constituency. Across the political spectrum, interest groups face this issue. But fundamentally speaking, it’s difficult to pass new laws that only reduce benefits or entitlements; in other words, it’s hard to take away something that’s already been given. A more balanced approach is needed to show some advantages to go with any disadvantages of a proposed change.
In order to be more successful, cuts in funding could be accompanied by some type of specific, positive features for a plan. If it seems essential to reduce Medicaid expenditures, one approach might be to define in detail the types of program adaptations that might be encouraged to increase the welfare of those affected. For example, one approach would be to apply some of the proposed savings to a specific type of health research that might improve care for everyone, or a suggested tax credit to convert some of the savings to increases in personal income, or funded Health Savings Accounts (HSAs) for everyone.
It is short-sighted not to couple some positive changes with negative ones, even if the net savings are reduced. Advocates and critics of proposed changes may then be better able to debate the merits and disadvantages of proposals and make more effective choices.
Changes to Medicaid might be approached by seeking more balanced strategies that enable emphasis to be placed on the use of some intended savings to best meet the needs of those affected and bolster support for appropriate program changes.
It seems to us that it is too soon to draw any conclusions about the final outcome of the ACA debate, which is likely to persist for some time. The ACA remains unstable, and proposals continue to churn even if they have been shifted to the sidelines. The eventual interests of both parties remain murky at this time, especially since much of the debate seems focused on political theater.
Congress has yet to deal with present ACA problems, so promotion and opposition to date have mostly served to put-off any decisions. There is a fairly good chance that any conclusions at present will have to be changed later.And again, we want to be certain that attorneys remain focused to deal with the uncertainties of the current healthcare landscape.
This post was written by Ferd H. Mitchell and Cheryl C. Mitchell, Thomson Reuters authors and attorney partners at Mitchell Law Office in Spokane, Wash. They are active in elder law and health law practice areas and have been working together on programs and activities on behalf of the elderly and in health care for more than 25 years. During their studies, they have visited and evaluated the health care systems of Japan and several countries in Europe to learn how the needs of the elderly are assessed and met in other countries, and they have been better able to understand the U.S. health care system and related care issues from these visits. More about the lessons learned from the ACA and issues involved in health program changes may be found in the 2017 edition of the authors’ book, Legal Practice Implications of Changes in the Affordable Care Act, Medicare and Medicaid, published by Thomson Reuters. More about these methods of analysis may be found in Mitchell & Mitchell, Adaptive Administration, published by Taylor and Francis. Follow the links below to read previous installments from this series:
The views and opinions expressed in this post are those of its authors alone.