Prospect of Medicaid Cuts Galvanizes AMA Conference

Ken Terry

June 13, 2017

CHICAGO ― As the US Senate works on its version of the House-passed bill to "repeal and replace" the Affordable Care Act, delegates at the American Medical Association (AMA) 2017 Annual Meeting that is being held here anxiously debated the association's stance on proposed Medicaid cuts.

Both in a hearing on Sunday and in the House of Delegates' voting session on Monday, the Council of Medical Services' report on changes to federal Medicaid funding generated intense controversy. At the heart of the dispute was the question of whether the AMA should accept the possibility that Medicaid might be converted from a guaranteed benefit to a capped payment to the states, either as a block grant or as a per capita amount. The House version of the American Health Care Act (AHCA) proposes to transform Medicaid in this manner, while also eliminating the ACA's expansion of Medicaid over 2 years.

In its original form, the AMA report centered on a series of guidelines for how the association should counter Congress' attempt to rein in federal Medicaid spending. Among the report's principles were the following:

  • People who are currently eligible for Medicaid should not lose their coverage, and federal funding for the program should not be reduced.

  • The amount of federal funding available to states should be sufficient to ensure adequate access to all statutorily required services.

  • Cost savings mechanisms should not decrease patient access to quality care or physician payment.

  • The methodology for calculating the federal funding amount should take into consideration each state's ability to pay for healthcare services.

  • The federal funding amount should be based on the cost of healthcare services for each state.

  • The federal government should continue to fund the Medicaid expansion in states that have expanded Medicaid and provide nonexpansion states with the option to expand Medicaid with additional federal funding.

  • The federal funding should be responsive to changes in healthcare costs or state-specific cost growth rates and not be based on a preset growth index.

  • Maximum cost sharing requirements should not exceed 5% of family income.

  • The federal government should monitor the impact of capping federal Medicaid funding to ensure patient access to care and adequate physician payments.

Oppose Caps

All of these elements were carried over to the final version of the report, with a few tweaks. There was also a new recommendation that the AMA should oppose caps on federal Medicaid funding, which would be a new policy for the association.

In the end, after a great deal of discussion on the conference floor, the AMA House of Delegates approved the new recommendation and referred the rest of the report to committee for further deliberations.

What happened? In essence, the majority of delegates were concerned that the AMA would seem to be supporting Congress' move to cap Medicaid spending if they endorsed a policy that could be interpreted as accepting the idea of funding limits.

The fireworks began during the Sunday hearing on the report, when delegate after delegate said that the AHCA plan to convert Medicaid funding to block grants would hurt their businesses and their patients. Declared a North Carolina pediatrician, "If we get these draconian cuts in the Medicaid budget, we will be out of business or we will have to reduce access to care."

Another delegate said, "We want AMA to stand with AAFP [American Academy of Family Physicians] and reject the cuts to Medicaid. Don't give the purveyors of alternative facts a roadmap."

A New York delegate agreed. "These aren't bad principles," he said of the report's guidelines, "but it's not the policy argument we need. We should talk strategy instead of accepting the possibility of Medicaid cuts. This would just give Republicans the talking points to cut Medicaid."

On the House of Delegates floor on Monday, the defenders of the report were more vocal than they'd been the previous day. One urologist said, "These are risky times for healthcare and for Medicaid. We agree with the message, 'Don't cap Medicaid.' But we need some guidelines to show them [Congressional Republicans] what we stand for. We're not showing our hand. We're showing the country what we stand for."

But another delegate received applause when he declared, "This is a fight for Medicaid. We have to make sure Medicaid funding isn't capped."

Primary Care Doctors in Bind

The prospect of limits on Medicaid funding seemed to agitate primary care doctors even more than their colleagues. Several pediatricians spoke emotionally about the many children who are dependent on Medicaid and who may be harmed if funding for the program is reduced.

In an interview with Medscape Medical News, Jack Ende, MD, president of the American College of Physicians (ACP), explained that primary care physicians have a lot of Medicaid patients. Many services that are covered by Medicaid, from women's health to substance abuse to preventive care, are mainstays of primary care, he pointed out.

If the Congressional proposals to change Medicaid go through, funding for the program, which covers more than 70 million people, will drop by 25%, Dr Ende estimated. "States must balance their budgets," he noted. "So if these cuts go forward, they will either drop people, cut services, or decrease payments to doctors and hospitals."

Asked whether the AMA was going in the right direction by setting down markers for what might be acceptable, or whether it should join with other associations to oppose the capping of payments, Dr Ende replied, "The house of medicine should be fighting this with one voice."

He said that already, the ACP and five other primary care associations, which together represent more than 500,000 doctors, have gone to Washington to plead their case with Congress. "We're very much concerned about the AHCA bill, and we hope the Senate bill doesn't move in a similar direction," he said.

More Medscape coverage of the American Medical Association (AMA) 2017 Annual Meeting is available online.

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