Healthcare in New Jersey heading toward a zombie apocalypse. Part III: Our imperiled Medicaid

Zombies in Congress are already hard at work to devise legislation to end Medicaid as we know it. At first corrosive legislation will come slowly, after all midterm elections are upon us. Nonetheless as long as Trump is around and Republicans control Congress there will be blood aplenty before it’s all over. The stakes for NJ are huge as the Medicaid expansion program has provided health care insurance to over 400,000 additional people who otherwise could not have afforded it. Trump’s proposed 2018 plan “An American Budget” is an American nightmare. Its stated goal is to repeal and replace all of Obamacare, and it offers numerous draconian measures.

It’s no surprise that Medicaid has become a big fat target for conservatives, particularly budget hawks like House Speaker Paul Ryan (pictured left). There are over 70 million Americans enrolled in the program. The federal government in 2017 spent a whopping $369 billion on Medicaid – an increase from $180 billion in 2007. Speaker Ryan said last year he’s been “dreaming” of cutting Medicaid since he was in college. His dream is shared by a multitude of conservative Republicans including Chair of the influential Freedom Caucus Rep. Mark Meadows who has no hesitancy voting for cuts in spite of the fact that some 100,000 of his constituents are in the program.

Conservatives are particularly upset that Obama’s ACA program introduced Expanded Medicaid which added some 15 million people to the rolls and increased substantially federal costs. To encourage states to enroll low income individuals who could not afford health insurance instead of sharing the cost with states 50-50 as done in the past, the government was willing to cover 100 percent of the costs through 2016, is now paying 94 percent of the costs, and by 2020 will pay 90%. A huge benefit for the states that joined, but an “entitlement” catastrophe to so many Republicans.

We can’t overestimate the importance of Medicaid to our state. Gov. Christie to his credit signed NJ up for Medicaid Expansion in 2013, although he later vetoed legislation that would have made the expansion permanent. As of June 2016 there were 1,753,000 New Jerseyans covered by the program – an increase of 469,000 since 2013, primarily through the expansion program. During that period the uninsured in our state dropped from 13.2% to 8%. It is available for the most needy – to an adult with income only up to 138 percent of the Federal poverty level (in 2017 the annual income poverty level was only $12,060); and children with household incomes up to 350% of poverty through CHIP which was recently reauthorized by Congress. Indeed we need more not less funding particularly for children as 70,000 kids in the Garden State lack health insurance including those eligible but not enrolled, those who exceed the income cut-off and the undocumented. In total there remains 700,000 New Jerseyans not enrolled in a healthcare plan.

Gov. Phil Murphy has has said he wants healthcare that works for all of us. However there is no way our state can finance the costs of keeping clients enrolled if Trump and the Republicans make significant cuts in the number of clients, cap the funding amount the State will receive via a block grant, or take a 90% cost sharing down to a 50-50 arrangement. In 2017 combined federal & state Medicaid spending in NJ was $14.6 billion of which the state paid $5.7 billion (39%) of the total. We don’t have an extra $5 billion to maintain the program. Indeed, we need more funding not less, particularly for children. There are 70,000 Garden State kids who lack healthcare coverage, including those who exceed the income level, those who are eligible but not enrolled, and the undocumented. In total some 700,000 New Jerseyans remain without insurance. This is a disgrace in such a wealthy country.

In lieu of immediately being able to end the ACA, the Trump administration appears to be settling for the second-best thing: weakening Obamacare’s insurance regulations. In the coming months, the government could approve waivers allowing states to impose work requirements on Medicaid beneficiaries, place a five year limit on Medicaid eligibility, and consider savings and other assets to determine and reduce those eligible. The government is already setting up a plan to allow five states to establish which drugs they would cover, something which would reduce costs but could lead to essential drugs not being available. The Kaiser Family Foundation ominously warns us, “All indications are that the prospect of significant changes to Medicaid will remain in state and federal policymakers’ sights – and in the news – during 2018.

Medicaid over the years has proven resilient in the face of conservative opposition, but with Trump and hard-nosed congressional budget-cutters we are now in a perilous world. Gov. Murphy has said, “We can no longer stand silent but must help to lead the fight against cuts to Medicaid and take the Republican leadership in Congress and President [Donald] Trump to task for their failures.” We must remain vigilant during 2018 to remind Republican House incumbents and would-be incumbents that we won’t stand for cuts. While undoubtedly there is some waste, fraud and abuse in the system, Medicaid remains one of our most important safety nets. Other industrialized nations view healthcare as a right not an entitlement. America should do the same.


You can read Part I which provides a broad view of the healthcare crisis and looks specifically at Trump’s injurious “An American Budget”  here. Part II shows how our governor and legislators are fighting back here.

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