UPDATE (6/5/2017): This story has been updated to reflect new calculations from the Virginia Department of Medical Assistance Services as to how much Virginia stands to lose if the American Health Care Act becomes law.
Medicaid is one of two government programs that provides health insurance for people who can’t afford it.
For Hampton resident Natasha Baker, it’s a lifeline that keeps her at work and her children in school.
“I’m not just sitting around — I work as a home care aid. If I could afford health insurance, I would pay for it. Medicaid is all we’ve got,” the mother of six said during a recent interview.
Baker works more than 40 hours a week at two minimum-wage jobs. When the 33-year-old or one of her children gets sick, the family uses Medicaid to pay for doctor visits and prescriptions.
In Virginia, more than 1.3 million Virginians use Medicaid to pay for everything from birth to nursing home care. Medicaid costs, whether to expand it and cover more people under the Affordable Care Act and now how the program could change under the American Health Care Act, have dominated the national health care discussion, but few talks describe what the program does and for whom it provides care.
“People who receive Medicaid are often very poor and very sick,” said Megan Philpotts Padden with Optima Family Care, the Medicaid program under Optima Health. “We advocate for people who can’t advocate for themselves and get them the health they need.”
In Virginia, Medicaid funds are mostly spent on two groups — children under 21 and people 65 and up.
The Virginia Department of Medical Assistance Services manages Virginia’s Medicaid program. Costs for the program are split 50-50 between the state and federal government. The state then pays doctors, hospitals and other caregivers for Medicaid patients at a reimbursement rate of 74 cents per dollar.
According to the most recent figures on states’ total Medicaid spending, roughly $8.5 billion was spent on Medicaid costs in Virginia, according to the nonpartisan health organization, Kaiser Family Health Foundation.
Who gets Medicaid?
In its 2017 annual report, the state agency that manages Medicaid described four groups who receive coverage — 642,391 children from low-income families; 363,643 parents, caregivers and pregnant women; 79,815 seniors; and 227,501 children and adults with disabilities.
Virginia spends most of its Medicaid funds — 49 percent — on children and adults with disabilities such as Down syndrome, cerebral palsy and autism, who need things such as feeding tubes, medical equipment and occupational therapy. It also pays for day programs, group homes and case managers to assist disabled adults. Medicaid does not cap how much can be spent on care for the disabled.
Seniors accounted for 19 percent of Medicaid spending, which pays for in-home and nursing home care as well as rehabilitation and other costs.
Poor children are a large Medicaid group in Virginia but account for only about 20 percent of its spending, which pays for baby wellness visits, immunizations, prescriptions and dental care.
Virginia spends just 15 percent of its Medicaid funds on prenatal appointments and other care for pregnant women, parents and caregivers, the agency’s 2017 report shows.
“We’re very responsible with taxpayer dollars,” said Philpotts Padden, who runs Medicaid programs for expectant mothers for Optima Health. “I’m a taxpayer, too. I want to make sure the funds are being used properly.”
With some of the nation’s strictest eligibility requirements, not everyone can receive health care under the Virginia program, DMAS communications director Craig Markva said in an email.
“The Medicaid program in Virginia covers certain groups: children under the age of 19, parent/caretaker relatives with dependent children in the home under 18, pregnant women, individuals age 65 or older or individuals who have been determined to be blind or disabled by the federal Social Security Administration,” Markva said. “For example, most adults from 18 to 64 do not qualify for Medicaid because Virginia is not an expansion state.”
Under the ACA, states could enroll more people in Medicaid, opening the program to people working part-time jobs that don’t offer health benefits and who make too much for traditional Medicaid qualifications but can’t afford other health insurance. An estimated 400,000 Virginians fall into this category, according to Kaiser Health Foundation reports.
To allay costs, the federal government would pay 90 percent of the cost for the new enrollments. More than 30 states expanded Medicaid, bringing the number of people receiving Medicaid to roughly 75 million nationwide.
The Virginia General Assembly has voted against expanding Medicaid in Virginia four times, citing concerns about the expansion costs and using the program’s existing costs, a major driver of state budget increases, as a factor.
Changes under AHCA
In early May, Republicans in the House of Representatives passed the American Health Care Act — all Democrats in the House voted against the act, as did 20 Republicans. The proposal, which is now before the Senate, would change the way Medicaid is funding, with states receiving block grants.
Instead of paying half the costs, the federal government would give states a fixed amount per person, based on 2016 Medicaid spending in each state, adjusted for medical inflation. House Speaker Paul Ryan has said the measure would give states more control over Medicaid and allow them to curb rising costs.
Democratic Gov. Terry McAuliffe told The Associated Press that the proposal would force Virginia to either raise taxes to pay for health care benefits or kick vulnerable people off Medicaid, which he says amounts to a “death sentence” in some cases.
The governor called President Donald Trump’s proposal a “crazy plan” and said, “He has put Virginia in a very untenable position.”
The Arc, a national organization that advocates for people with intellectual and developmental disabilities, said the funding formula for AHCA cuts too deep, taking away funds many states would be hard-pressed to replace. The cuts would not only leave millions without health insurance but would also cause strife for people with disabilities and their family.
“The hole will be vast, and it will consume decades of progress in investing in supports and services for people to be served in the community instead of in isolated and segregated institutions or facilities,” said Marty Ford, the organization’s public policy senior executive director, in a news release. “People with disabilities and their families fear the loss of community-based supports and a return to institutional services.”
DMAS has run numbers estimating the effect of the proposed funding change. From 2020, when the new law would kick in, through 2026, Virginia would receive $708 million less than it is set to under the current system.
DMAS did a break-out that points to where the biggest strains will come — basically the elderly and disabled. They would be capped at $35,114 for the elderly and $38,656 for people with disabilities in 2026, versus projected costs of $38,583 and $39,580, respectively. For children, the cap would be $5,266 and projected costs $5,632 in 2026.
To deal with the gap, DMAS has limited options. It can try to cut reimbursement rates, but these are already low enough that some doctors won’t accept Medicaid patients, state officials say. It can cut services it covers. It could trim eligibility, but with already stringent guidelines, state officials have little wiggle room.
For Bons Secours, whose faith-based mission makes it morally imperative to care for the sick, changing Medicaid’s payment formula could pressure hospitals and caregivers to provide more uncompensated care like the care uninsured people receive when they go to an emergency room, said Thom Prevette, the health system’s director of Advocacy and Community Relations.
The new law could curb efforts established under ACA to promote wellness and better habits to keep people out of the hospital in the first place, Prevette said. “We’re actively engaged in discussions on how to move forward and provide the health care needed in this community. We want to continue to provide the quality of health care Americans have come to expect, and from a faith-based perspective, they deserve.”
Hampton resident Latonya Lane watches the national health care debate with fear about what changes to Medicaid will mean for her and her family. She works part time and cares for her 8-month-old baby. Lane, 32, is trying to complete a college degree while she and her boyfriend prepare for a new baby on the way.
“We’re people, human beings,” Lane said in a recent interview. “We’re doing the best we can, struggling to get by. Medicaid takes care of my baby. I’m trying to get us a better life. This helps a lot of people.”
The Associated Press and staff writer Dave Ress contributed to this report. Canty can be reached by phone at 757-247-4832.
