Study: Montana to lose $4.8B in Medicaid funding

Montana stands to lose $4.8 billion in federal dollars for its Medicaid program over six years, according to an independent analysis released Wednesday.

The report, commissioned by the Montana Healthcare Foundation, looks at what could happen if the U.S. House GOP health reform bill comes to life.

In line with the drop in funding, more than 70,000 adults enrolled through the recent Medicaid expansion are expected to lose coverage by 2026, according to the analysis conducted by Manatt Health.

Foundation Chief Executive Officer Aaron Wernham said the possible cuts would weaken the state’s health-care system, which he said would trigger issues the state would have to work to balance.

“These cuts would hurt Montana’s most vulnerable residents, including children, seniors and people with disabilities,” Wernham said.

In May, the U.S. House passed the American Health Care Act as an effort to replace President Barack Obama’s health-care law, the Affordable Care Act. House Republicans said that insurance markets in many states were crumbling as carriers left the market offered through Obama’s law.

At the White House ceremony celebrating the House passage, Speaker Paul Ryan, R-Wis., praised the legislation as a fulfilled promise.

“Many of you have been waiting seven years to cast this vote,” Ryan said to the scores of Republican House members present, according to an Associated Press report. “Many of you are here because you pledged to cast this vote.”

The House legislation would change the structure of Medicaid financing by imposing per-capita caps on state Medicaid expenditures. It would also effectively eliminate Medicaid expansion by removing the enhanced federal funding after 2019 — dollars guaranteed by the act known as “Obamacare.”

As of May, 77,154 Montanans had enrolled in the expansion, according to the state health department. Of those recently covered, 7,803 are Flathead County residents. In Lincoln County, so far there have been 1,883 enrollees and in Lake County there have been 2,878.

Leadership in the U.S. Senate has set out to draft its own version of national health reform. Still on the negotiation table are the per-capita caps and the phase-out of funding for Medicaid expansion.

Jason Spring, the chief strategic officer at Kalispell Regional Healthcare, said the Mannatt report lines up with the Congressional Budget Office’s analysis of the law’s potential impact on Americans. The Congressional report predicted the act would leave 23 million people nationwide uninsured over 10 years.

“The current ideas in the AHCA and being floated by the Senate in the news will not be good for Montana or rural America,” Spring said in an email.

According to the report, the magnitude of the federal cuts could affect Montana’s ability to finance other priorities such as education and infrastructure.

“It’s time for folks in Washington D.C. to work across the aisle to increase affordability and quality of health care across America – instead of gutting Medicaid, a program that works,” Gov. Steve Bullock said in a statement on Wednesday.

The governor said those drafting the bill are doing it behind closed doors.

Party leaders selected 13 Republican senators to negotiate the health-reform bill in private talks without public hearings or testimony.

Wernham said due to the potential consequences of the provisions known at this point, the Montana Healthcare Foundation commissioned the analysis to show the combined impact of the proposed Medicaid changes in Montana.

Medicaid represents 38 percent of federal dollars coming into Montana, according to the Manatt report.

To stay under a per-capita cap, Montana would need to cut its Medicaid spending by a total of $888 million in federal and state dollars between 2020 and 2026. If Montana exceeds those caps in a year, its funding for the next year would be rolled back. If the state shells out less than what it has to offer, those saved dollars would never be seen by the state.

Deborah Bachrach, partner and co-author of the analysis, said the Montana report, “makes clear that per-capita caps are really just cuts by another name.”

Reporter Katheryn Houghton may be reached at 758-4436 or by email at khoughton@dailyinterlake.com.