State warns against federal threat to cut Medicaid funds

Feb. 27--Federal cuts envisioned for Pennsylvania's Medicaid plan would cost the state at least $2 billion dollars by 2020, opening a budgetary hole that would be impossible to fill, state Secretary of Human Services Ted Dallas said Monday.

The Medicaid reductions, which could also end coverage for about 700,000 Pennsylvanians, are part of a Republican leadership plan to replace the Affordable Care Act, which was presented Saturday to the National Governors Association meeting in Washington D.C. Details of the proposal were compiled in a report by Avalere Health, a Washington D.C.-based health care consultant, and New York City-based management consultant McKinsey & Co.

In place of matching, open-ended federal Medicaid dollars to the state, the legislation being drafted would be replaced by fixed-amount grants, which is "simply a way to cut Medicaid," Mr. Dallas said. The legislation could be introduced as early as this week.

"There is no way to cover those costs," Mr. Dallas said during a call-in news conference with Insurance Commissioner Teresa Miller and Secretary of Health Karen Murphy. "There is no way for us to cover the cost shift this federal legislation would have."

The concern in Harrisburg comes as House Republicans draft legislation that would end the ACA, also known as Obamacare, in part, with either block grants or per capita grants that are expected to reduce federal spending by $50 billion in 2020. States would have the option of tightening Medicaid eligibility requirements, creating job search mandates for eligible beneficiaries or increase cost-sharing among Medicaid recipients to cover the loss of federal funding.

More than 1.1 million Pennsylvanians receive coverage through the ACA and so-called Medicaid expansion funding, which allows people with earnings that are about one-third higher than the federal poverty level to receive government-subsidized coverage.

More than 55,000 low-income adults and children in Allegheny County receive health care benefits through the expansion money, according to a new report by the Downtown-based Pennsylvania Health Funders Collaborative.

Kris B. Mamula: [email protected] or 412-263-1699

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