ANCOR Issues Statement on House Energy & Commerce Committee Proposals to Cut Federal Medicaid Funding

WASHINGTON, DC — In response to the text released before the U.S. House Energy & Commerce Committee’s markup of its budget legislation, ANCOR released the following statement:

“We are closely monitoring tomorrow’s markup by the Energy & Commerce Committee, and remain concerned that the reductions in Medicaid funding included in this bill will impact people with intellectual and developmental disabilities (I/DD). Included in the legislation are significant cuts to health care that would total at least $715 billion. Any reduction in funding will diminish resources and force states to reduce their Medicaid spending as well,” said Barbara Merrill, chief executive officer for ANCOR. “The thousands of community providers who support people with I/DD are already struggling immensely to retain workers, maintain services, and accommodate new referrals, all due to insufficient Medicaid funding. If Congress cuts Medicaid even more—whether or not those cuts are specifically targeted to disability services—the programs that enable people with I/DD to meaningfully participate in our society will be first on the chopping block when state budgets are unable to absorb the financial shock.”

ANCOR is particularly concerned about the following provisions in this legislation, which would impact the sustainability of disability services:

• Limitations on state spending through provider taxes: The proposal to eliminate the ability of states to increase or introduce new permissible health care-related taxes, including provider taxes, curtails the flexibility states currently have to finance their Medicaid programs. Provider taxes account for an average of 17% of states’ Medicaid budgets, meaning any reduction in the amount of non-federal funding available to states will have a significant negative impact on the federal match funding states can receive.
• Reductions in federal funding for certain states: The reduction in the federal match rate for states that use non-federal funding to provide Medicaid coverage to certain individuals will hamstring those states’ budgets and could force states to reduce Medicaid services, including optional services like home- and community-based services. Reducing the FMAP (Federal Medical Assistance Percentage) as a penalty to states for serving undocumented immigrants will diminish states’ flexibility to determine what coverage is appropriate for their residents and could have harmful effects on Medicaid services for everyone in those states.
• Implementation of work requirements: The introduction of mandatory work and community engagement reporting requirements for beneficiaries will create administrative burdens for states and could jeopardize the access of people with disabilities to community-based services. While targeted to “able-bodied” individuals, these requirements—especially when poorly defined—would likely have a negative impact on people with disabilities as well as direct support professionals and other caregivers, who may be inadvertently disenrolled in Medicaid coverage despite purported exemptions. Approximately one-third of direct care workers work part-time or with inconsistent schedules—features that make it difficult to meet work reporting mandates. These new requirements, coupled with the introduction of cost-sharing requirements, could lead to a loss of Medicaid coverage for caregivers and direct support professionals, which would further exacerbate current workforce shortages and lead to a reduction in access to community-based supports.

To put it quite simply, if Congress wants to protect people with disabilities, it must protect Medicaid. For that reason, we urge all members of the House Energy & Commerce Committee to vote against this budget reconciliation legislation as currently drafted.

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