Tim McBride: Senate Plan is Biggest Cut Yet to Health-Care Safety Net

Faculty; Policy

The U.S. Senate’s proposed overhaul to the health-care system, released last week, will cause more than 24 million Americans to lose coverage, estimates a health economist at Washington University in St. Louis.

“For many people, the out-of-pocket cost of medical care will rise significantly and the number of uninsured will rise by a large number in the long run — I expect over 24 million when the Congressional Budget Office completes its estimates this week,” said Timothy McBride, professor at the Brown School and co-director of the Center for Health Economics and Policy.

“In short, this piece of legislation is one of the largest rollbacks of the safety net protecting people from the burdens of medical costs that has ever been proposed.”

While official numbers have not yet been released, McBride estimates the Senate bill would “lead to very large, perhaps devastating, cuts to the Medicaid program.”

“This results from rolling back the expansions of Medicaid in Obamacare starting in the long run, but also converting the existing Medicaid program to a block grant (per capita capped) program. The cuts arise from spending growth limited to a rate significantly lower than the current rate of growth in the program,” McBride said.

“How these spending cuts will affect current and future enrollees in the program is unclear, but it is clear that the states will need to significantly reduce the number of people covered by the program, and benefits offered,” he said. “And Medicaid currently covers about 75 million children, disabled, aged and other adults.”

The Senate bill also proposes significant changes to the so-called marketplaces, McBride said.

“All analysts know these marketplaces need policy changes. But the changes proposed will lead to significant drops in the subsidies for some people, especially older people (those close to retirement age) and those above three times the poverty line,” he said. “In addition, the proposed law would significantly scale back the coverage available to people (called essential benefits), and weaken the provisions guaranteeing that people with pre-existing conditions could obtain affordable coverage.”