The GOP has unveiled separate bills to repeal 'maintenance of effort' requirements for Medicaid and Children's Health Insurance Programs – an action they say is necessary to help states balance their budgets in the face of ballooning healthcare costs.
Sponsored by Sen. Orrin Hatch (R-Utah) and Rep. Phil Gingrey (R-Ga.) and with the support of a number of Republicans in both chambers, proponents say repealing MOE requirements will allow states the needed flexibility to rein in the rising costs of the insurance programs and could also save the federal government $2.8 billion over five years.
At issue are requirements that states not weaken their enrollment for the state-sponsored health insurance programs for the poor – a key provision as the Affordable Care Act looks to greatly expand the rolls of Medicaid in 2014.
"The Medicaid program has historically been a partnership between states and the federal government where states could manage their enrollment in a way that meets the needs of their citizens and keeps their budgets balanced," noted a Republican summary of the proposed legislation. The summary highlights a number of different provisions of the ACA that, they contend, hamper the ability of states to manage their own Medicaid and CHIP programs.
"These restrictions prohibit states from implementing even common-sense enrollment modernizations," the GOP summary concluded.
[See also: HHS offers states advice on achieving Medicaid savings; Arizona governor seeks to drop 280,000 from state Medicaid rolls]
President Barack Obama's administration and Congressional Democrats are likely to give a cold shoulder to the bills, saying they would effectively allow governors and the states the power to shrink the Medicaid rolls and thus increase the number of poor who have no health insurance.
In March, a number of provider organizations expressed their concern about any weakening of the MOE requirements. In a letter to Health and Human Services Secretary Kathleen Sebelius, seven healthcare organizations, including the American Hospital Association, Catholic Health Association of the United States, Federation of American Hospitals National and Association of Children's Hospitals, noted that repealing MOE would be a step backward.
"A relaxation of the MOE provisions will push many low-income Americans off Medicaid rolls, thereby increasing the number of uninsured – moving us backwards rather than forward towards the ACA's goal of expanded health coverage. Removing people from Medicaid does not keep them from getting sick and will deter them from seeking the care that they need," the March 1 letter stated. "Further, it shifts the burden of their care from states and the federal government largely onto the nation's hospitals. Hospitals currently provide some $40 billion in uncompensated care and the loss of the Medicaid MOE will only increase this burden on providers."
The legislation faces an uphill climb in the Democrat-controlled Senate and would likely face a presidential veto if it were to pass both chambers.
Instead of repealing MOE, the Obama Administration has signaled a willingness on the part of HHS to provide relief to states through waivers intended to broaden their flexibility in the design of Medicaid and CHIP programs.