AHCA, Medicaid Reform, and Kids

March 17, 2017

The American Health Care Act (AHCA) is the GOP’s current proposal to roll back the Affordable Care Act (ACA) and reform Medicaid. Fortunately, ACA provisions regarding pre-existing condition protections and the ability to keep your child covered by insurance until they are 26 years old seem to remain intact in this latest proposal. More concerning are the changes planned for Medicaid – a health insurance program covering children, disabled individuals, and elderly individuals.

Embedded in AHCA is a transition from the current federal Medicaid funding methodology to a per capita cap methodology, which is a fixed amount paid by the federal government per person. The Congressional Budget Office (CBO) has estimated that AHCA will reduce federal funding for Medicaid by 25 percent – an estimated $880 billion dollars. To help soften the financial blow, states are being promised increased flexibility in administering their state Medicaid programs. The upside of this new flexibility, however, cannot compensate for financial losses of this magnitude.

What does this mean for children – and specifically those in South Carolina?

Nationally, there are around 30 million children covered by Medicaid, providing health insurance, on average, to about 40 to 50 percent of children in each state. In South Carolina, Medicaid has an even bigger footprint – providing health insurance for 66 percent of children in the state.

In case you missed that key point, it’s worth stating again. Medicaid provides health insurance to two-thirds of the children in South Carolina.

Because children represent the majority of enrollees in Medicaid, they cannot escape any across the board reductions in eligibility or benefits that may result as states try to deal with 25 percent less federal funding. And when you take that amount of money out of a healthcare system, the impact will be felt by all children – not just those covered by Medicaid. The great irony here is that children (despite representing the majority of enrollees in Medicaid) cost, on average, less than half of what adults cost who are covered by the program. Given these startling statistics, it is puzzling that mainstream media have largely ignored the impact these cuts will have on children. That clearly needs to change.

What also needs to change are provisions in AHCA that lower minimum Medicaid eligibility levels for children and that will lead to disruption in coverage. Additionally, all children, including those who have Medicaid because of a disability, should be covered under a combined children’s per capita cap rate that is adequate to meet their unique healthcare needs. Combining all children into one rate will allow for accountability, and on a larger scale, true improvement in population health for kids.

Please contact your elected officials to ask that children’s essential healthcare needs and dependence on Medicaid for these needs be protected as AHCA moves forward. You can easily identify and contact your congressional representatives at the following websites.

U.S. House of Representatives: Find Your Rep (Need your zip code)

U.S. Senate: South Carolina Senators