AMA 2017: Medicaid changes in AHCA could limit healthcare delivery innovation

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 - Richard Deem
Richard Deem, the AMA's senior vice president of advocacy, speaking at the 2017 AMA meeting in Chicago.

The American Medical Association (AMA) doesn’t think highly of how the Senate may change Medicaid funding and coverage through repealing and replacing the Affordable Care Act (ACA), judging by a presentation from the AMA’s annual meeting in Chicago.

Richard Deem, the AMA’s senior vice president for advocacy, described a “rushed process” in the Senate to pass the American Health Care Act (AHCA), skipping over the typical public committee hearings much like the House did before the bill narrowly passed in May. Meeting behind closed doors, Deem said, has been driven by Republicans’ desire to quickly get past healthcare reform to other legislative priorities, hopefully voting on the bill before the Senate’s July 4 recess.

The results so far has been push and pull between Republican factions concerned over different issues. Deem cited how one major sticking point has been how to phase out the ACA’s expansion of Medicaid. The House bill would do so in two years, while some Senate Republicans in expansion states want a five- to seven-year phaseout, but Deem criticized both proposals for not focusing on the impact to patients.

“As one physician who met with their senator this past week said, ‘If 200,000 people in my state are going to losing coverage, is the real question whether it’s in two years or five years?’” Deem said.

The Congressional Budget Office had said around five million people would lose Medicaid eligibility in 2018 if the AHCA was signed into law under a previous version of the legislation.

Along with a rise in uncompensated care costs from lower Medicaid enrollment and more uninsured patients, Deem said providers’ treatment decisions would be affected by funding the program only through per-capita allotments or block grants. This would likely disconnect funding from the actual costs of care and leaving providers and patients with the extra expense.

The example he has been using to illustrate this problem involves expensive treatments for hepatitis C.

“Drug comes along that’s curative (at) at big cost to the program,” Deem said. “This formula does not reflect the kind of innovation that we know is going to occur in the delivery of healthcare.”

Other controversial parts of the AHCA may be left out of the Senate bill, according to Deem, particularly the ability for states to waive community rating provisions and allow insurers to charge more based on pre-existing conditions—a change House conservatives have already called a deal breaker. If the Senate can pass the bill, possibly with Vice President Mike Pence casting the tie-breaking vote, Deem predicted the more conservative House won’t be given the chance to rework the legislation.

“Don’t count (Senate Majority Leader) Mitch McConnell out,” Deem said. “I think the House will have to either accept, up or down, or not, the Senate package. I don’t see a conference going on through the summer, then ping-ponging this back and forth. Some people don’t know if some of the conservatives in the House will go along with that.”