WASHINGTON (CN) - While the White House scrambles to defend the Republican health care bill in the wake of a damaging report by the Congressional Budget Office, experts shed light Tuesday on the grim outlook.
Dee Mahan, the director of Medicaid initiatives at Families USA, focused on the problems that can arise from shifting to a formula in the Republican plan from the guaranteed match under the Patient Protection and Affordable Care Act.
When states shift their Medicaid costs according to their needs under Obamacare, the federal government matches their spending, reimbursing between 50 percent and 75 percent of what they spend on beneficiaries.
But the new health care bill calls for a per-capita allotment for state Medicaid spending, said Mahon, whose Washington-based nonprofit advocates for affordable, high-quality health care. Rather than matching state spending, the federal government will give states a fixed amount for each Medicaid enrollee.
Mahon said that capped amount will not change regardless of fluctuations in health care costs. This could be problematic for states that see see a spike in older and sicker populations over time as demographics change. "There's no adjustment for that" under the Republican plan, Mahan said.
Mahan pointed to an HIV crisis in Indiana as an illustration of how the proposed bill could stymie efforts to deal with public health crises.
In 2015, the state had to spend more on diagnosis, treatment and prevention because of an HIV outbreak in Scott County linked to residents sharing needles for prescription opioid use.
Mahan said the state was comfortable with the uptick in spending because it knew the federal government would match the spending. She noted, however, that states would be on their own to fund such initiatives under the proposed bill. This means states will end up spending more, Mahan added.
The Congressional Budget Office’s highly anticipated report on the Republican plan Monday included the shocking figure that 24 million Americans could lose health coverage by 2026.
But Health and Human Services Secretary Tom Price said the nonpartisan auditors got it wrong. "We believe that the plan that we're putting in place is going to insure more individuals than currently are insured," Price said.
Against the bright line of $337 billion in possible savings for the federal government over 10 years under the Republican plan, the CBO found that a significant chunk of those savings will come from $880 billion in federal spending cuts to Medicaid.
The CBO says insurance premiums could drop 10 percent, but that 14 million Americans will be squeezed out of Medicaid as a result.
White House budget director Mick Mulvaney was quick to counter this finding Monday afternoon at a press conference outside the White House.
"The CBO score assumes that if you are on Medicaid today, you will chose to be off Medicaid when the mandate goes away,” he said.
"Does that make sense to anybody,” Mulvaney added. “The plan doesn't get rid of the Medicaid expansion.”
Mahan from Families USA meanwhile noted that the proposed per-capita cap structure would let the federal government freeze inflation adjustments to the Medicaid program to free up money for other spending - for example, funding an infrastructure program.