Casey calls for boost in Medicaid dollars
Sen. cites economic hardships in decision
WASHINGTON — As states contend with shrinking tax revenue and growing health care needs amid the COVID-19 pandemic, Sen. Bob Casey, D-Pa., is dusting off legislation proposed during the 2008 financial crisis: an automatic increase of federal Medicaid dollars to states as their unemployment rate rises.
Mr. Casey on Tuesday introduced the Coronavirus Medicaid Response Act, which uses a formula to determine
individual states’ unemployment pressure points and delivers federal Medicaid assistance in proportion with the economic pain.
Under the formula, Pennsylvania would receive roughly $2 billion per quarter in additional aid if the unemployment rate would register at 10% during the three months ending June 30.
In an interview, Mr. Casey said the arrangement would create a quicker and more responsive federal process for supporting state Medicaid programs, which reimburse health care provided primarily to low-income and elderly patients. Given the steep financial challenges states have seen in previous economic downturns, he said, Medicaid funding should be independent of Congress.
“The problem is that determination [to increase Medicaid dollars] becomes a question of how many votes you can line up,” Mr. Casey said.
“It just doesn’t make sense to allow something as fundamental as Medicaid and the matching dollars to be at the whim of whoever is in power, as opposed to having a good program’s benefits be triggered by economic trauma,” he said.
In March, Congress approved a temporary increase in Medicaid funds for the life of the public health emergency. Both parties came together to pass legislation totaling more than $3 trillion in spending. Mr. Casey wants a permanent, more precise change.
It is not a new argument. More than a decade ago, Jay Rockefeller, the long-serving West Virginia Democratic senator, unsuccessfully pushed fellow lawmakers to support automatic payments during the recession.
Adjustments to the payments — doled out using a system known as FMAP, or the Federal Medical Assistance Percentage — remained the sole discretion of Congress. Historically, lawmakers have rarely given benefits a significant boost.
Then as now, Mr. Casey’s measure faces an “uphill battle” in the Republicancontrolled Senate, the senator acknowledged. But he said this time could be different.
Both Democratic and Republican governors are contending with dual health care and economic crises. The COVID-19 pandemic has exposed long-standing shortcomings in Medicaid funding for health providers like nursing homes. And Medicaid-focused providers waited months to receive their chunk of provider aid approved by Congress.
“The lesson I learned from the Great Recession is you’ve got to go big to jumpstart the economy and get it out of the ditch,” Mr. Casey said.
“The danger here is we compound the problem of a public health and jobs crisis by penny-pinching when it comes to a program like Medicaid,” he said. “It will make every problem worse.”
Mr. Casey is hoping to build momentum for his bill as Congress is set to consider a fourth round of major COVID-19 legislation in July.
Mr. Casey’s legislation was co-sponsored by 12 Senate Democrats, including Sen. Sherrod Brown, of Ohio, and endorsed by 22 think tanks, labor unions and health care organizations, including UPMC. A House version of the measure was introduced in April by Rep. Susie Lee, DNev.
A 2016 report from the Government Accountability Office found the current aid distribution model, which is based on each state’s per capita income, to be a “poor proxy for both the size of a state’s population in need of Medicaid services and the ability of a state to fund Medicaid.”
This is especially true during economic downturns, the GAO report found. It recommended basing assistance on increases in a state’s unemployment and reductions in total wages and salaries of its workers.
From February through May, Medicaid enrollment in Pennsylvania grew by 118,000 people, or about 4.2%, the Pennsylvania Department of Human Services reported last week.
Meanwhile, the state’s unemployment rate nearly tripled to 16.1% in April and remained at 13.1% in May, according to the Pennsylvania Department of Labor and Industry. June figures are due out in two weeks.
The legislation is based on formulas that, using historical unemployment data, calculate a threshold for what constitutes high joblessness in each state. The percentage-point increase in unemployment is increased by a multiplier to arrive at the new level of Medicaid assistance.
For Pennsylvania, high unemployment is calculated to begin at 5.5%, so a 10% unemployment rate would trigger an increase in Medicaid dollars of 21.6 percentage points, or about $2 billion.
Tuesday’s bill introduction came as Pittsburgh workforce officials pledged to help connect new Medicaid enrollees with job opportunities.
Partner4Work, the Downtown-based workforce development agency, announced a $150,000 grant from the Richard King Mellon Foundation to open up job-seeking Medicaid enrollees to the PA CareerLink network to prepare them for careers.
A press release from the agency noted UPMC Health Plan’s Medicaid managed care organization serves 460,000 Medicaid members, of which nearly 120,000 are working-age adults in southwestern Pennsylvania.