Tuesday, February 14, 2023

How vulnerable is Medicaid in the debt ceiling battle?

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Feb 14, 2023 View in browser
 
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By Joanne Kenen

With additional reporting from Ari Hawkins and Calder McHugh

A protester with a sign that reads

Protesters rally against Medicaid cuts in 2017. | Drew Angerer/Getty Images

BIRTHS, DEATHS AND OPIOIDS — Medicare and Social Security look like they are off Washington’s proverbial budget-cutting table in this spring’s debt ceiling showdown after President Joe Biden’s impromptu sparring with the GOP during the State of the Union.

That could mean Medicaid — the combined federal-state health program that currently covers about 90 million low-income Americans, including lots of kids and elderly people — will have a great big spot of its own on that spending cut table.

Nobody knows how intense the brinkmanship over raising the national debt ceiling will be, or how deep the partisan acrimony may run a few months from now when we hit the “X date” when the federal government won’t be able to pay its bills. Either way, Medicaid is politically better positioned to weather the storm than ever.

The House Republican “Commitment to America” released before the fall elections was vague on trimming spending, and even more vague on health policy. The conservative Republican Study Group’s budget blueprint for the current fiscal year would have restructured Medicaid entirely and cut $3.6 trillion over a decade compared to the current spending trajectory — but there’s no way that Democrats (or even some more establishment Republicans) would accept that.

Medicaid, once the overlooked stepchild to the big two entitlements, Medicare and Social Security, has become a bigger part of the U.S. safety net. And it’s got a much stronger constituency. Republicans included a bid to turn Medicaid into a block grant program — an idea that dates back to the Reagan years — as part of its decade-long effort to repeal the Affordable Care Act. But that assault on Medicaid was one reason repeal failed.

“Medicaid is way more politically resilient than people think,” said Larry Levitt, executive vice president for health policy at the Kaiser Family Foundation. He noted it’s the largest payer of nursing home care in the U.S, and it’s a lifeline for disabled kids and their families, both very politically sympathetic populations.

The program has expanded a lot over the years, including covering more low income people under Obamacare, although 11 states are still refusing to take part. Many more people got Medicaid coverage during Covid, although some will lose Medicaid as the public health emergency declaration winds down.

More than half of US kids are covered by Medicaid and its sister program the Children’s Health Insurance Program or CHIP. In some states, more than half of births are covered, and it provides postpartum care, including to minority populations that have disproportionately high rates of maternal death. And it covers long-term care for the poor elderly — or people who became poor after spending most of their savings on long-term care.

“Medicaid now is touching the majority of families in the country. It’s part of people’s lives at critical junctures. Birth and death,” said Joan Alker, executive director of the Center for Children and Families at Georgetown University. Meaning renewed Republican efforts to target it will likely receive pretty intense pushback.

It’s also a huge payer for mental health and for addiction treatment for opioids, including for kids.

“If you are cutting Medicaid, you are chopping at mental health in a bad way,” said Ezra Golberstein, a University of Minnesota health economist who studies behavioral health.

And — as if all that wasn’t enough — Medicaid keeps safety net hospitals afloat. And those hospitals, which treat a large share of poor people in both rural and urban settings, are in an even more precarious financial position than usual after the pandemic.

“They are fragile in the best of times,” said Bruce Siegel, president and CEO of America’s Essential Hospitals, which represents those hospitals. Now, he said, “they are losing money,” partly because of high labor costs and temporary staff brought in to fill pandemic-related shortages. Even without a big GOP attempt to overhaul Medicaid, these hospitals face a scheduled cut in special payments they get — although Congress has reversed similar planned cuts to health providers in the past.

“Cutting Medicaid,” Siegel said, “ would lead to some hospitals, major systems in this country, closing access — and potentially closing hospitals.”

Medicaid is a great big pot of money — more than $700 billion in fiscal 2021 (though it may decline as the pandemic wanes). So if budget cutting is the name of the game this spring, Republicans will likely take another run at it. Even if they don’t go down the block grant path, there are a host of other conservative ideas — charging premiums, enacting work requirements, limiting eligibility — that they could turn to.

Which doesn’t mean they will succeed.

Tom Miller, a health expert at the center-right American Enterprise Institute who has written extensively on what he sees as more realistic conservative approaches to improving Medicaid, including broader use of federally-approved waivers for states, expects conservative Republicans to try again this year — and again overreach and fail.

“There’s healthcare blustering,” he said. “And the blustering stage may be at another magnitude.”

Welcome to POLITICO Nightly. Reach out with news, tips and ideas at nightly@politico.com. Or contact tonight’s author on Twitter at @JoanneKenen. And a very happy Valentine’s Day to all of our readers — in our book, you’re all our Valentines.

 

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What'd I Miss?

Nikki Haley's campaign announcement video.

— Nikki Haley is officially running for president: Haley, the former ambassador to the United Nations, announced today she is running for president in 2024. A former South Carolina governor, she enters the race as former President Donald Trump’s first challenger in the Republican primary. Haley announced her run in a three-and-a-half minute video posted to Twitter, touting her accomplishments as governor and declaring “it’s time for a new generation of leadership” in Washington. “Republicans have lost the popular vote in seven out of the last eight presidential elections. That has to change,” Haley said in the video.

— Feinstein passes on Senate reelection in 2024: Sen. Dianne Feinstein (D-Calif.) announced she will not run for reelection in 2024, capping a 30-year Senate career and accelerating a succession battle that’s already well underway. Few people believed the 89-year-old Feinstein would seek another term. Reps. Katie Porter (D-Calif.) and Adam Schiff (D-Calif.) have both launched campaigns for Senate — although Schiff said his was conditional on Feinstein not running again — and Rep. Barbara Lee (D-Calif.) is preparing to launch her own.

— Girlfriend of Proud Boys leader pleaded fifth about plan to occupy government buildings: Prosecutors say a romantic acquaintance of Proud Boys leader Enrique Tarrio — who provided him with a tactical plan to occupy government buildings just days before Jan. 6, 2021 — pleaded the Fifth when subpoenaed in May. Erika Flores, a Florida-based cryptocurrency advocate, “answered only brief biographical questions and then invoked her Fifth Amendment right not to testify repeatedly in response to more than 50 transcript pages worth of questions by the government” about the document titled “1776 Returns,” prosecutors revealed in a Monday night court filing. That document is now at the heart of the government’s seditious conspiracy charge against Tarrio and four other members of the Proud Boys, who are accused of masterminding the riot and breach of the Capitol that day.

— Biden taps Fed’s Brainard as top economic adviser: Biden will tap Federal Reserve Vice Chair Lael Brainard for the White House’s top economic policy job as the U.S. braces for a high-stakes fight over the debt ceiling and a possible recession, according to two administration officials. Brainard will replace Brian Deese as director of the National Economic Council, becoming the first woman to head the agency since 1996. Jared Bernstein, a longtime adviser to Biden, will likely become the president’s chief economist, according to the officials, who requested anonymity to discuss personnel changes before the official announcement.

AROUND THE WORLD

DEMOCRACY MUZZLED — The government of Cambodia revoked the operating license of one of the country’s last independent media outlets — Voice of Democracy — after Prime Minister Hun Sen said the publication "hurt" the country’s reputation. The closure comes months ahead of a national election and underscores the government’s renewed efforts to unravel democratic norms across the country, Ari Hawkins reports for Nightly.

Hun Sen said the decision to shutter VOD, which reports on labor and human rights issues as well as environmental crime and political corruption, came after the outlet published an article on Cambodia’s aid delivery to Turkey.

The story noted that Hun Manet, the prime minister’s son, signed an agreement to donate the funds after Turkey was struck by a devastating earthquake earlier this month. The move is an exercise of authority that exceeds his role as deputy commander-in-chief of the Cambodian army, and Hun Sen said the report damaged the government’s reputation.

VOD’s radio arm was already shut down in 2017, as part of a government purge of dozens of stations ahead of the 2018 elections. That same year, the independent Cambodia Daily newspaper was also pulled from the presses and another outlet — The Phnom Penh Post — was sold to pro-government businessmen in 2018.

“It’s incredibly sad to see a repeat of five years ago,” Alex Willemyns, an Australian journalist who co-founded VOD told Nightly in an interview. “VOD Khmer had for years been at the forefront of reporting on never ending government corruption and land-grabbing in the country. Without VOD, it’s pretty hard to imagine how that continues.”

The Cambodian Center for Independent Media, the non-government organization which operated the news station, issued a statement that expressed “regret” over any confusion caused but also stated that the contentious quote –– “It is not wrong for Hun Manet to play his father’s role in providing aid to Turkey” –– came directly from a government spokesperson.

Nevertheless, the country’s leader reiterated that VOD would not have its license restored in a statement posted on Facebook this morning. He added that the unemployed journalists would be offered work in government positions.

“Every single reporter and editor at VOD could have taken a job at a pro-government media outlet at any point in time over the past decade and been rewarded with a much larger salary. The fact that they didn’t is a testament to their courage, even in a media environment where threats are common,” Willemyns said.

The government of Cambodia is scheduled to hold a general election in July. Human rights observers say that Hun Sen’s government has already stacked the deck in his favor. The latest press restrictions are being viewed as a legislative version of recent intimidation tactics directed at the Candlelight Party, which is considered Hun Sen’s primary competition.

Khieu Kanharith, the minister of information in Cambodia, described the decision to revoke VOD’s media license on Sunday as a “lesson for other media outlets” in a Facebook post over the weekend. “Institutions that do not correct their comments may face the same license revocation!,” he added.

"Media censorship is the hallmark of authoritarian regimes,” Beh Lih Yi, Asia Program Coordinator at the Committee to Protect Journalists wrote to Nightly. “Shutting down one of Cambodia’s last independent news outlets ahead of the country’s general elections scheduled for July is a clear move to suppress criticism or any form of independent reporting.”

 

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Nightly Number

6.4 percent

The percentage increase of consumer prices in January compared to January of last year, down from 6.5 percent in December and a peak of 9.1 percent last June. Still, the newest inflation number remains far above the Federal Reserve’s stated target of 2 percent, and consumer prices increased 0.5 percent from December to January, much higher than the 0.1 percent rise from November to December.

Radar Sweep

THE BUSINESS OF KILLING — On a busy Saturday in November, veterinarian Andrew Bullis treated a puppy with parvovirus, who, despite his best efforts, was trying to die. He also treated a cat diagnosed with cancer, which was set to be euthanized. And on the same day — he listened patiently while a couple explained they could not afford surgery for their canine “Lacey” and as a result would like to have her put down. More than the industry’s poor compensation, abuse from clients, long hours and isolation from colleagues, the frequency of euthanasia helps explain why veterinary medicine has such a high rate of suicide. Conducting the procedure, convincing patients when it is the best choice for their pet and watching the emotional breakdowns unfold when high medical costs force owners into the decision — can all weigh on the soul. Nevertheless, the skill of killing “flawlessly” remains a critical part of the work. Read Andrew Bullis’s autobiographical report into the business of killing for Vox.

Parting Words

Heart-shaped signs with Valentine's Day messages on the North Lawn of the White House in 2021.

Heart-shaped signs with Valentine's Day messages on the North Lawn of the White House in 2021. | Alex Wong/Getty Images

SAY IT WITH A MEME — This year’s Valentine’s Day has been a busy one in the world of politics — among other developments, we’ve had a high-profile retirement (Sen. Dianne Feinstein) and the announcement of the first Republican challenger to Donald Trump in the 2024 presidential primary (Nikki Haley).

But here at Nightly we’ve noticed that politicians are still managing to celebrate America’s day of (vaguely corporate) love, even if it’s with generally anodyne proclamations of love — witness Barack and Michelle Obama and Mike and Karen Pence.

Fortunately, we don’t just have to rely on official Twitter accounts to have a little fun this holiday, writes Nightly’s Calder McHugh. Some clever cupids on the internet have spent the day making Valentine’s Day cards for the political junkie in your life: how about a sweet photo of Pete Buttigieg reading “When I saw you my heart stopped like the flights did,” or maybe “Misinformation? I want to make you Mrs. Information.”

We hope you enjoy the cards. And if you’d like to make your own, our friends at the Washington Post have you covered. Our email is nightly@politico.com… we never say no to an expression of love.

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