Hard Times Test Obama's Promise of More Medicaid

(WOMENSENEWS)–The health care reform law signed by President Obama in March promised to add 16 million low-income Americans–many of them childless women who didn’t qualify under the old rules–to the Medicaid rolls by 2020.

But women’s health care advocates fear the current fiscal crisis threatens that goal in many states and are anxiously watching how Congress will vote on expanding Medicaid benefits.

"Expansion of Medicaid is the heart of the Obama health reform plan, so it is crucial that Congress pass a six-month expansion of extra funds for Medicaid when it returns to Washington this week," said Sara Finger, chair of the Madison-based Wisconsin Alliance of Women’s Health, an independent network of organizations in the state. "Without Medicaid, poor women can’t obtain basic medical services because it is a desperate struggle to keep a roof over one’s head and put food on the table for one’s family with an income at the poverty level."

While the House is widely expected to favor a Medicaid funding expansion, the Senate is expected to have a longer debate over the matter, leaving the vote pending until September. Summer recess for lawmakers begins Aug. 9 and goes through Sept. 12.

Poverty-level income was $10,830 for an individual and $22,050 for a family of four in 2009. The poverty rate for women was 13 percent in 2008, significantly higher than the rate for men, which was about 10 percent. Government sources won’t have data for 2009 for several weeks.

With unemployment hovering around 10 percent nationally, enrollment in Medicaid is expected to increase 21 percent from 2009 to 2011, according to a June report by the National Governors Association and the Association of State Budget Officers.

Against that backdrop, 30 states face budget shortfalls by Dec. 31 unless the federal government assumes a greater share of the cost of providing health insurance for indigent children, pregnant women and disabled adults.

Rising Costs Potentially Sink Budgets

Many states assumed that Congress would approve the extension and included the extra funds in their budgets for 2011. Now the states are worried that rising Medicaid costs will sink their budgets.

"There have already been significant cutbacks that have hurt women and the problem could get worse," said Anne S. Kasper, chair of the Maryland Women’s Coalition for Health Care Reform in Bethesda. "Up to now, states have kept their Medicaid programs afloat by decreasing the reimbursement rate to physicians and other providers and limiting services like dental to tooth extractions. Many providers have dropped out of the program because they cannot afford to treat Medicaid patients. As a result, many women have had to wait longer for care or go without vital services."

The jobless rate for women in June was lower than for men; about 8 percent versus 10 percent. But women generally earn less than men and have fewer assets to tap during periods of extended unemployment.

Each year, the federal Medicaid matching rate–which stipulates the ratio of federal to state contributions–is calculated for each state and varies depending on average personal income in the state.

Before 2009, the federal rate averaged 57 percent nationwide, but the stimulus act raised the federal government’s share to 66 percent. Some lower-income states received as much as 86 percent of their Medicaid funds from the federal government.

Shortfalls could be worse in 2011 because it takes three or four years after a national recession for tax receipts in the states to bounce back.

Trimming Costs

States are taking various measures to trim their costs.

To close its $109 million Medicaid gap, Nevada plans to ration adult diapers, eliminate hearing aid programs and require personal care assistants to purchase their own disposable gloves.

Republican Gov. Jan Brewer of Arizona claims that her state cannot afford to provide services for poor people currently on the rolls, let alone those who lose their employer- provided insurance when they become unemployed. She recently asked Congress to allow Arizona to eliminate more than 300,000 poor Arizonans from its Medicaid rolls.

Congress is unlikely to approve Arizona’s request if it observes the new federal health care reform law requiring states to maintain Medicaid programs at current levels.

"Education and Medicaid are the biggest expenses in most states, so advocates for poor women without health insurance could find themselves battling parents and teachers for smaller pieces of the revenue pie," said Finger.

Republican Gov. Edward G. Rendell of Pennsylvania has threatened to lay off at least 20,000 government workers, including teachers and police officers, to reduce the state’s $1.2 billion deficit in 2011. Colorado plans to eliminate all-day kindergarten for 35,000 children next year.

Unlike the federal government, which can use deficit financing, states must, by law, operate within their budgets.

Until the health care reform bill was passed, only six states provided Medicaid to childless adults. The program mainly served children from poor families, the disabled and pregnant women.

But starting in 2014, any childless adult under age 65 with an income of 133 percent of poverty will qualify. The federal government will provide extra funds to the states for poor people they add to the Medicaid rolls between 2014 and 2020.

‘A Tremendous Advance’

"Covering childless adults will be a tremendous advance," said Natale Zimmer, public policy and communications director of the Older Women’s League, or OWL, a Washington-based advocacy group of middle-aged and older women. "Poor childless women have had the most difficult time obtaining health insurance because few have qualified for public programs no matter how low their incomes."

Unemployment and divorce hits these women hard, she said. Employers are often reluctant to hire workers over age 50 and if they do, the jobs often don’t provide health insurance benefits.

"Divorced women and widows often find themselves without health insurance because they cannot afford the premiums of individual policies," said Zimmer. "As a result, they spend their limited savings on medical care, which leaves them financially vulnerable during retirement."

Studies show that about 29 percent of poor childless adults have two or more chronic health conditions.

"That is why it is so important for the states and Congress to take steps now to preserve Medicaid programs, so that everyone can benefit by 2020 when health care reform is fully implemented," Zimmer said.

Thanks to $87 billion in stimulus funds, states were able to provide Medicaid services to 59 million poor Americans, including 21 million women who are parents, during the recent recession, the most devastating in 70 years. (Medicaid serves mostly poor children: 30 million kids, usually living in households headed by women.)

The New York-based Guttmacher Institute, a leading provider of research about reproductive health, predicts that states will save money in the long run if they find a way to provide all the Medicaid services that people in their states need. The organization says it’s more efficient to expand Medicaid with its emphasis on preventive care than to leave poor people uninsured and dependent on expensive, hospital emergency rooms.

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Sharon Johnson is a New York-based freelance writer.