Alabama Senate race: GOP candidates differ on proposed Medicaid changes

June 11--Getting rid of the Affordable Care Act is something all the Republican candidates for Alabama's U.S. Senate seat agree on. Even a Democrat in the race says the ACA should be a starting point for health care discussions.

But ask about changes to Medicaid funding and essential health benefits that Congress will consider -- both of which could have a significant effect on Alabama's health care system -- and the responses range from enthusiastic embrace to wait-and-see approach to outright opposition.

A Senate version of the bill has not yet appeared. But medical providers say block granting the Medicaid program -- which plays a major role in keeping Alabama hospitals and primary care providers open -- could cut back state funding. That could hurt hospitals and patients, particularly in rural areas of the state.

Medicaid provides health insurance to 1 million Alabamians, almost all of whom are children, the elderly or the disabled. More than half the children in the state qualified for Medicaid in 2015, according to the Alabama Medicaid Agency. The state's hospitals also count on Medicaid to ensure a flow of patients to keep their doors open, and primary care providers -- particularly pediatricians -- see many patients through the program.

The state has struggled in recent years to provide adequate funding for Medicaid, due to rising costs and legislators' unwillingness to raise taxes or transfer existing revenues to the fund. But the federal government provides a match of more than $2 for every dollar Alabama spends on the program as part of a financing formula that rewards states with lower incomes, like Alabama.

The AHCA would do away with the federal match, replacing it with a per capita block grant providing a fixed amount of money per enrollee, whatever their health costs were. The state's 2016 spending would form a base for what Alabama would get. That could be a problem, said Danne Howard, executive vice president and chief policy officer for the Alabama Hospital Association, because Alabama spends less on Medicaid than other states and did not expand Medicaid eligibility, as offered under the ACA.

"If you use 2016 as a base year for per capita caps, we'll be perpetually at the bottom of the pile again," she said.

The Congressional Budget Office estimates the AHCA would cut Medicaid funding by more than $800 billion over the next several years, which could hit the state hard. Doug Jones, seeking the Democratic nomination for the U.S. Senate seat, opposes block granting the program.

"We are one of the poorest states in the country (and) we are one of the most unhealthy states in the country," he said last week. "We have a lot of people with pre-existing conditions. Those people depend to some extent on Medicaid. To do away with Medicaid as opposed to expanding Medicaid would really hurt the state."

U.S. Rep. Mo Brooks, R-Huntsville, who, like nearly every other member of Alabama House's delegation, voted for the House version of the American Health Care Act (AHCA), which would create a block grant for the program and supports the proposal. Brooks argues that will give Alabama leaders a better chance to shape health care policy in the state.

"The closer the government is to the people, the better the government is and the more responsive it is to the needs of the people," he said.

Republican candidates are more cautious about the prospect of block granting the program. Sen. Luther Strange -- who said last week he expects a vote on a Senate health care bill before the Fourth of July -- said it was "premature" to address that question before the bill emerges.

"I just don't know what the financial impact is," Strange said in a phone interview Thursday. "I support the idea of giving states more flexibility for their own needs. Alabama's decision makers should have as much flexibility as possible."

Former Alabama Chief Justice Roy Moore said last week he'd have "to see the proposal" for any Medicaid block grant. Randy Brinson, a gastroenterologist by trade, said he would support block grants if states submitted detailed plans on how they plan to spend the money.

"You've got to have a plan to account for all that," he said. "That's why I wouldn't arbitrarily block grant money. You have to show viability for all these resources."

Sen. Trip Pittman, R-Montrose, who chairs the Alabama Senate's General Fund committee, said if Congress approved block grants, he wanted to see Alabama funding protected to some extent.

"We have a very lean, efficient Medicaid," he said. "My philosophy does not believe in penalizing the good for being good. There needs to be some credit given for those who are efficient with Medicaid."

The ACA required insurers to cover 10 health care benefits, including maternity care; mental health and prescription drugs. The AHCA would allow states to determine what's required for coverage, and some experts say the move could allow states to do away with the coverage altogether.

Mark Jackson, the executive director of the Medical Association of the State of Alabama, representing physicians, said he would like to see essential health benefits stay.

"We think that's one of the positives from the Affordable Care Act," he said. "We would like to see those maintained and not done away with."

Republicans running for the Senate seat broadly support giving states the waiver.

"That is a matter for states to resolve on a case-by-case basis as they determine what their citizens can afford," Brooks said.

Moore and Pittman both said they thought competition in a free market, would force insurers to offer those benefits. Whether competition would come to the market is an open question: Blue Cross Blue Shield of Alabama dominated the state's health insurance market, before and after the Affordable Care Act. Insurers who have tried to break into the state have been unable to make inroads.

Brinson said he would prefer allowing people to build on basic plans. Strange said those matters are "best left to the state and experts," though he said senators were reviewing provisions in the AHCA that would allow insurers to charge those with pre-existing conditions more money.

Jones, the Democrat, said he opposed state waivers. While he said he was open to some negotiation over the benefits, he felt some, particularly maternity care and mental health, should be mandatory.

"I don't trust Washington at this point, but I sure don't trust Montgomery either," he said.

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