Any Medicaid changes require care, not haste

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With nearly 1.2 million Minnesotans enrolled in Medicaid, chances are you know someone who gets their health care through this publicly funded program for low-income people.

Typically referred to in Minnesota as “medical assistance,” Medicaid covers 3 in 10 kids in the state and 1 in 3 people with disabilities. It plays a vital role in paying for long-term care, with more than half of nursing home residents here relying on it, according to KFF, a nonpartisan health policy organization. Another eye-catching data point: The program covers 33% of births in Minnesota, ensuring that nearly 21,000 babies born here each year get off to a healthy start.

Medicaid also provides critical access to mental health care and is on the front lines in the ongoing fight against a public health crisis: addiction to opioid painkillers. It is the “largest payer of substance use disorder treatment” in the United States, according to a 2023 medical journal analysis.

This workhorse of a program does a lot of good, which is why it’s important to be clear-eyed about the consequences of potential Medicaid reforms, particularly those intended to swiftly wring savings from it. While the intricacies of a congressional debate over Medicaid might seem distant, the decisions made in Washington, D.C., could affect the health care of someone you care about.

That’s why the coming debate over Medicaid requires close attention as President-elect Donald Trump is inaugurated and a new session of Congress begins. During Trump’s first term, Republicans unsuccessfully sought sweeping changes to the program. While Medicaid and health care weren’t a high-profile 2024 campaign issue, news reports suggest discussions are underway again in Washington, D.C., about “significant changes to Medicaid” and other safety-net programs.

Elon Musk’s DOGE advisory group is also looking for savings. From his perspective, it’s logical to look at big-budget programs such as Medicaid. The program is jointly financed by the state and federal governments. Annual spending stood at $872 billion in 2023, translating to 18% of total national health expenditures, reports the Centers for Medicare and Medicaid Services (CMS).

For context, Medicare, the federally run medical insurance program mainly serving Americans 65 and up, accounts for 21% of total national health expenditures.

One key political difference between these two essential programs: Medicare’s constituency wields considerable clout. Older Americans vote. And AARP and other groups would fiercely oppose Medicare changes that might adversely affect seniors.

Many of Medicaid’s enrollees are likely struggling just to keep a roof over their heads. The program may also lack grassroots advocates because too few people know of Medicaid’s foundational role in funding long-term care, services for the disabled, labor and delivery, mental health care and substance abuse treatment.

Minnesota’s world-class medical community merits praise for sounding an early alarm. More than 130 organizations signed a Dec. 20 letter to the state’s congressional delegation noting that they are “united in opposition” to major Medicaid changes:

Signatories include the Minnesota Medical Association, the Minnesota Hospital Association, the Minnesota Rural Health Association, Hennepin County and Hennepin Healthcare System, Children’s Minnesota, Fairview Health Services, UCare, The Arc Minnesota, Amherst F. Wilder Foundation and LeadingAge Minnesota, the latter being a long-term care trade group.

NAMI Minnesota (National Alliance on Mental Illness) is another signatory. Executive Director Sue Abderholden warns that the state’s mental health system is already strained. Funding cuts could reduce access for this care even further, she said during a Thursday interview.

Changes that result in federal savings could in turn put a hit on state finances. Federal Medicaid funding for Minnesota stood at $10.8 billion in fiscal 2024, according to state officials. Even a slight reduction in federal support could leave a gaping state budget hole. Gov. Tim Walz’s office said Friday that this is one of the federal issues he is most concerned about.

To be clear, I welcome the opportunity to look for efficiencies in federal programs. In a column earlier this month, I pointed out the potential for billions in Medicare savings by reducing overpayments to private insurers who administer the Medicare Advantage program. Implementing this wouldn’t be easy because of insurers’ political influence. But it’s an example of an approach that prioritizes those the program serves over entities profiting from it.