The Ryan Budget: Bad for Our Health

by | Apr 9, 2014 | ACA

Budgets reflect priorities. Last week, House Budget Chairman Rep. Paul Ryan (R-Wis.) released the House Republican budget. If adopted, it would take health insurance away from millions of Americans, turn Medicaid into a block grant, and put seniors’ access to comprehensive Medicare coverage in jeopardy.

By repealing the Affordable Care Act (ACA), the Ryan budget would eliminate health coverage for the more than 7 million Americans who enrolled in quality, affordable plans through the ACA’s marketplaces. It would undo the ACA’s Medicaid expansion provision, leaving even more lower-income men and women without coverage options. Without the ACA, insurers would be free, once again, to deny coverage to people with pre-existing conditions, to charge women more than men for the same policies, and to offer subpar plans that fail to cover essential services like maternity care. In short, this budget would cost millions of families their health security and, in doing so, jeopardize their economic stability.

The Ryan budget would jeopardize access to health coverage for even more vulnerable families by turning Medicaid into a block grant program. Right now, the federal government matches or exceeds states’ contributions to their Medicaid programs, depending on the state’s per capita income. Thus, if a state’s Medicaid expenditures rise – due to surges in Medicaid eligibility and enrollment, for example –federal matching contributions increase as well. The matching funds have proven to be especially important during economic downturns, when individual incomes and state revenues simultaneously plummet.

The Ryan proposal would change current Medicaid policy by instead mandating that the federal government annually contribute a fixed amount of money – a block grant – to each state for its Medicaid program. Under this model, if a state were to spend more Medicaid dollars than anticipated, the federal government would not increase its contribution. This policy change would make it possible for states to skimp on Medicaid – trimming benefits and making coverage available to fewer people – to save or reallocate revenue elsewhere.

The Ryan budget also would end Medicare as we know it, forcing seniors to cover, over time, a larger and larger percentage of their health care costs. With minor changes, this year’s Ryan budget is strikingly similar to the one from 2010 in its attempt to turn Medicare into a voucher program. Seniors opting to purchase private plans would be given a fixed amount of money from the government to buy coverage. But the catch is that the value of this voucher would not increase commensurate with rising health care costs, forcing seniors to cover more of their medical bills over time. Only traditional Medicare plans would have the strong consumer and cost-sharing protections many seniors need to meet their health care needs. Consequently, private plans would attract younger, healthier seniors, causing Medicare costs to increase exponentially and undermining the financial stability of the program. Eventually, traditional Medicare would be financially unsustainable. Over time, Medicare beneficiaries would be forced into private plans and those who couldn’t pay out-of-pocket for comprehensive coverage would go without the care they need.

Put simply, the Ryan budget would cost millions of women, seniors and families their health and financial security. These are the wrong policies for our country and would undermine economic growth, worker mobility, and family stability.