Analysis: Ga. would suffer under House budget cuts

Georgia would be “hit very hard” under a budget plan passed by Republicans in the House of Representatives, the leader of an advocacy group argued Tuesday. But another budget expert said current spending is “unsustainable.”

 

The liberal-learning group Families USA released a state-by-state analysis of the House budget passed along party lines that would turn Medicaid into a block grant, repeal measures in the Affordable Care Act and make changes to Medicare. Under that budget, during the next 10 years, Georgia and its residents would lose $18.6 billion in Medicaid funding plus $40.3 billion from an expansion of Medicaid in the health reform law, $21.6 billion in tax-credit subsidies and $5.5 billion in Medicare spending, which amounted to the ninth-largest loss among states, said Ron Pollack, the executive director of Families USA.

“The state of Georgia is going to be hit very hard, especially because Georgia stood to gain enormously from the improvements of the Affordable Care Act that expanded the Medicaid program,” he said.

Medicaid eligibility in Georgia would have been greatly expanded, with the federal government paying all of the costs for the expansion in the first three years and never less than 90 percent after that, Pollock said.

But what Families USA fails to recognize is the current level of health care spending is not affordable, said Patrick Louis Knudsen, the senior budget expert at the conservative Heritage Foundation.

“If you are talking about the relative costs of Medicare and Medicaid right now, people have to realize that those programs are unsustainable at their current rates of spending,” he said. “The fact is, doing nothing will surely end Medicare as we know it because it is so financially fragile that it will crumble under its own weight.”

While agreeing there is a need to find “cost efficiencies” in the system to lower spending, Pollack said the cuts just shift costs.

“What we’re seeing throughout this proposal is an attempt to shift the burden from the federal government to the states and, as you know, states are not in great shape to shoulder that burden,” he said. “The same is true with lower and moderate income people and families.”

In Georgia, for instance, 107,300 people receiving help with Medicare prescription drug coverage would lose that coverage under the proposal.

The House budget speaks to a different philosophy of government that seeks to return spending power to the state and local level, Knudsen said.

“One of the trends in the 20th century was that more and more domestic activities moved toward Washington rather than states and localities. And now we’ve reached a point where Washington can no longer financially sustain all of that,” he said. “The assumption is that because state and local governments are closer to their own populations, they are in a better position to tailor their programs more effectively for their own people.”

Pollack said it would be more effective to look at reforms within the health care system, such as better coordination of care.

“The people with the highest health care costs tend to be people with multiple chronic conditions,” he said. “And they wind up seeing numerous physicians. And often, nobody is coordinating the care.”

Both Knudsen and Pollack said they expect this debate about government’s role and size to be a key theme in this year’s elections.

“I think the issue of fairness will be squarely in front of the voters because I think the two presidential candidates are going to have very different approaches to how they want to deal with the budget deficit,” Pollack said. “I think they both agree that we’ve got to do more to reduce the budget deficit. The real difference is how they try to achieve that.”

POSSIBLE CUTS

Families USA did a state-by-state analysis of the impact of a budget passed by the House of Representatives and what it says are the corresponding cuts to health care programs and those who use them. The numbers are cumulative for the next 10 years and are reported in billions of dollars:

 Current Medicaid cutExpanded Medicaid cutMedicare cutSubsidy cutTotal
Georgia18.56440.2825.48021.57185.897
South Carolina12.97518.3893.4209.60144.385
 

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