Trump and Medicaid
September 16, 2020
Photo via U.S. Department of Homeland Security
President Trump had big plans to fundamentally change how Medicaid worked. Has his administration had any lasting impact on the program?
Listen to the full episode and read the transcript below.
This episode is part of a special series examining the goals, actions and impacts of President Donald Trump and former Vice President Joe Biden’s health policies. See all of our reporting for that series here.
President Trump's Attempts to Change Medicaid
- Reduce federal spending on Medicaid
- Give states more flexibility to run their own programs
- Pursued failed legislation that would have:
- Lowered and capped Medicaid funding to states
- Eliminated Medicaid expansion and partially replaced it with block grants
- Focused on increasing eligibility verification requirements for Medicaid recipients
- Approved several state waiver applications to tie Medicaid eligibility to work requirements
- Encouraged states to apply for waivers to deviate from federal minimum requirements in exchange for capped financing
- Revised “public charge” rule to make it harder for immigrants to get a green card if they are likely to use Medicaid or other safety-net services
- Medicaid enrollment had decreased slightly pre-pandemic, especially among children
- Courts have blocked work requirements in most states
- Only one state (Oklahoma) applied for capped financing waiver, and it later withdrew
- Reports of decreased participation because of public charge rule
- Seven states adopted Medicaid expansion, despite administration opposition
Dan Gorenstein: How long have you been watching and thinking about Medicaid in your career professionally?
Robin Rudowitz: Oh gosh. A long time. Probably 20 years, close to 20 years.
DG: It’s Day 3 of Trump Week, our 5-day exploration of this administration’s goals, actions and impacts on health policy.
Today, Medicaid, among the most fiercely debated parts of the U.S. health care system.
From the Annenberg Studio at the University of Pennsylvania, I’m Dan Gorenstein, and this is Tradeoffs.
DG: Medicaid has been a political piñata since it was first introduced along with Medicare in 1965.
News clip: President and Mrs. Johnson and Vice President Humphrey arrive for ceremonies that will make the Medicare bill a part of Social Security coverage.
DG: Today the health insurance program for low-income and disabled Americans covers about 1 out of every 5 people in the country.
Research has shown Medicaid can have a positive impact on people’s financial well-being and reduce mortality.
States run their own programs, but Washington covers about 60% of all costs, with total spending near $600 billion dollars in 2018.
Robin Rudowitz is the co-director of the Kaiser Family Foundation Program on Medicaid and the Uninsured.
DG: In one word, a phrase, how would you describe the Trump administration’s efforts around Medicaid?
RR: It’s hard to do one word, but a phrase I think would be to limit the scope of coverage and federal financing.
DG: The president most famously tried to cut Medicaid by repealing and replacing the Affordable Care Act.
News clip: All told the GOP bill would cut an estimated $900 billion from Medicaid over the next 10 years, reducing Medicaid’s ranks by 14 million people.
DG: The ACA expanded Medicaid to include people who made less than 138% of the federal poverty line, that’s about $17,000 for a single person.
This includes people without disabilities and low-income childless adults who are often not covered by traditional Medicaid.
But the president wanted to do more than unwind Medicaid expansion — he wanted to transform the program.
News clip: The GOP plan that passed the House yesterday would for the first time place caps on federal Medicaid funding to states starting in 2020.
DG: So multiple times, Trump has proposed turning Medicaid into a block grant program, a move aimed at eliminating billions.
Robin, can you break down this idea of block grants?
RR: So right now, there’s a guarantee to states for unlimited or uncapped federal matching dollars. So when states spend more money or see costs go up, they are guaranteed these federal matching dollars that support the program. So, instead of having this guarantee for states, the federal government would say, no, we’re going to cap the amount that the federal government would spend.
DG: The President has argued this would cut federal spending and encourage states to eliminate fraud and abuse.
But many health policy analysts agree block grants would likely force states to pick up additional costs, cut back on care, and/or drop people from the rolls.
DG: Through these proposals from the Trump administration, how much money were we talking about saving?
RR: At that time, the Congressional Budget Office had estimated that various proposals that had been on the table would reduce federal spending by 25% to a third of spending. It would be a major fundamental reshaping of the program — who would potentially be eligible, what services would be covered as well as, you know, the financing mechanisms.
DG: So that’s goal number one: less federal funding.
Goal number two involved giving states more control over their programs. Seema Verma, head of the Centers for Medicare and Medicaid Services, talks about this a lot.
Seema Verma: States are trying to make routine changes or craft innovative programs, but they’re thwarted by the rigidity of a federal bureaucracy that’s rooted in a 1960s program design.
DG: Republicans often say they want Medicaid to be a program that offers a hand up, not a handout.
The point: Encourage people to get off Medicaid as quickly as possible.
President Trump embraces this philosophy and has directed Seema Verma to let state’s reimagine Medicaid by granting waivers, effectively experimenting with things like mandatory work requirements and monthly premiums for enrollees.
Seema Verma: By giving states unprecedented flexibility to administer and design their programs to meet this population’s very unique needs.
DG: These waivers can lower costs for states and Washington. Critics, though, say these moves push people who rely on Medicaid out of the program.
News clip: The Trump administration announcing it’s going to allow the states to require people on Medicaid work.
DG: One of the most popular waivers in red states? Work requirements.
News clip: It is a major reversal of decades of policy.
DG: Robin says 19 states have applied to add them to their programs.
The Trump administration has approved more than half of them, but only one state actually started removing people who didn’t meet the new rules.
RR: Arkansas was one of those states that had actually implemented the work requirement and reporting requirements. And as a result, over 18,000 people were disenrolled.
DG: In March 2019, a federal court halted Arkansas’ new policy, saying it was inconsistent with Medicaid’s goal of providing health insurance to low income people.
DG: OK, Robin, work requirements have effectively been shut down by several court rulings, no state is currently moving forward with block grants. So have the administration’s policies had any real impacts on the number of people receiving Medicaid?
RR: That’s a good question. I think that prior to the pandemic, we’ve seen two years of declines in Medicaid enrollment, and while some of that is likely attributable to a more robust economy, there have also been some policies that have been put in place to increase verifications, which has made it more difficult for individuals to obtain and maintain coverage. And then there have been some other issues around proposed changes related to immigration.
DG: You’re talking about the “public charge” rule, right, where immigrants are less likely to get approved for a green card if they use public programs like food stamps, housing vouchers or Medicaid.
RR: Yes, and there’s been some evidence that the effect has been to cause individuals who may continue to be eligible for coverage to not seek coverage because of fear of some of the immigration policies.
DG: We should say that while most of his moves have been strongly opposed by Democrats, the administration has approved popular waivers helping states address the opioid epidemic, and the president backed bipartisan legislation that makes it easier for people to get treatment.
Robin, based on what you have seen in the first three and a half years or so of this administration, what would you expect from a second term when it comes to Medicaid?
RR: I think we would expect a continuation of many of the same policies, continued efforts to limit the scope of the program. But it’s not just the presidential election I think that matters in terms of Medicaid, certainly what happens in Congress, but also what happens at state elections. So for governors and state legislatures and how those are made up make a big difference in terms of the movement of Medicaid going forward.
DG: Robin, thanks so much for talking with us. We really appreciate it.
RR: Thanks for having me.
DG: Day 3 of Trump Week is in the books.
You can find more of our coverage of President Trump and former Vice President Biden’s health policy positions at tradeoffs.org/trumpbiden.
Tomorrow, we’ll look at the president’s record on reproductive rights and women’s health.
Maya Manian: Conservative administrations have always aimed to restrict abortion, but the attack on contraception wasn’t there in the same way that we’re seeing it.
DG: I’m Dan Gorenstein. This is Tradeoffs.
Want more Tradeoffs? Sign up for our weekly newsletter!
5 Things To Know About Trump’s Medicaid Block Grant Plan (Rachana Pradhan and Phil Galewitz, Kaiser Health News, 1/31/2020)
Medicaid Program Integrity and Current Issues (Samantha Artiga and Robin Rudowitz, Kaiser Family Foundation, 12/10/2019)
Medicaid 1115 Work Experiments: The Current State of Play (Sara Rosenbaum, Alexander Somodevilla, Maria Velasquez, Morgan Handley and Sara Rothenberg; Commonwealth Fund; 1/28/2020)
Medicaid Work Requirements In Arkansas: Two-Year Impacts On Coverage, Employment, And Affordability Of Care (Benjamin D. Sommers, Lucy Chen, Robert J. Blendon, E. John Orav, and Arnold M. Epstein; Health Affairs; 9/2020)
Robin Rudowitz, Co-Director, Kaiser Family Foundation Program on Medicaid and the Uninsured
Music composed by Ty Citerman, with additional music this episode from Blue Dot Sessions and Bacon.
This episode was reported, produced and mixed by Ryan Levi.