Cantwell Remarks on Graham-Cassidy Bill

Senator Maria Cantwell's Questioning Before the Finance Committee Hearing on Graham-Cassidy

Round 1:

Senator Cantwell: On this subject, I’m having a tough time understanding the overall philosophy of this legislation. I can say that I definitely had town meetings and was encouraged by the fact that Senator Cassidy wanted flexibility for states. I was encouraged, I think I even mentioned it, that he wanted flexibility.

But the reason that we’re not working together now on this legislation is because it is taking the premise of flexibility and turning it on its head as it relates to a program that has been a 52-year relationship between the state and federal government. It is taking a 70 million [person] population and basically saying, ‘I’m going to change the way health care is delivered to you’ under the ruse that you are trying to address the individual market which is 19 million—18 million.

So you are trying to say to people, ‘I’m fixing that in the individual market’ when you’re not. Premiums in states that expanded Medicaid have seven percent lower premiums in the individual market.

And the notion that we should do this because of Temporary Assistance for Needy Families (TANF), that TANF was some sort of lifeline, the TANF experiment which I should bring up, your state is the lowest in the nation in per capita TANF benefits in the sense of for every 100 people you serve the least TANF benefits.

What has driven people out of poverty in America is not the way we’ve structured TANF; it’s the EITC, it’s the SNAP program—that is what has helped.

And so now to take this block grant experiment and say that you were going to somehow magically drive down costs in health care when in reality you were just kicking millions of Americans off with the ruse of putting them into a capitated program and then cutting their benefits.

So to me it is not a panacea for the future. I would love to see… Oh, by the way you take the one creative, flexible idea that states have, section 1331, that has allowed 650,000 people in the state of New York to get cheap, affordable health care at $500 of premiums, and X’d that out. So you took one the most creative ideas that will cost New York billions, probably $3-4 billion because you’ve X’d it out. So my point is this to Ms. Miller. I’m pretty sure there are innovative ways in the Affordable Care Act to drive down cost. I’m pretty sure Pennsylvania took advantage of them. I think you helped expand a program to get people off of nursing home care into community-based care. In our state that saved billions, I’m pretty sure that probably will save a lot of money in Pennsylvania.

What about those ideas in driving down the cost of Medicaid, because my colleagues on the other side, I think, seem to think the only way you can drive down the cost of Medicaid is cutting people off. And I totally disagree. In fact, I think this chart that raises the question on rural health care is how many people in hospitals rural America. The non-expanded states have seen the most closures of rural hospitals in America. Why is that? Why is that?  So the notion that somehow we have in the corner of Graham-Cassidy figured this out, I just don’t believe it. So do we have innovation in the Affordable Care Act that is driving down cost in the Medicaid market in a very significant way and can we push it faster?

Panelist Teresa Miller (Acting Secretary, Department of Human Services Commonwealth of Pennsylvania): Thank you Senator. I think you’re alluding to our community health choices program that we’re rolling out. I think we all know that seniors want to be served in their communities and I think that our governor has made a real push to get people out of nursing homes and let them age in their communities. And we also know that in terms of the cost to Medicaid, it’s mandatory in terms of paying for nursing home services but community based services are not mandatory. And yet, moving people out of institutions and into the community is how we’re going to save money for both the state and federal government.

Round 2:

Sen. Cantwell: Thank you Mr. Chairman. I want to go back to my first round because now that we have the CBO score, which is pretty illuminating. Well, I would say it’s pretty detailed in its effects on Mediciad. In fact it says, quote “in general states would not have substantially additional flexibility under the per capita cap.” So a few states would probably obtain additional flexibility. And then it goes on to say “however because funding under the program at the rate of CPIU, CBO anticipates that it would be attractive mainly to the few states that expect to decline in population and would have little effect on enrollment in Medicaid. That’s who would be attracted to it.

It would not be attractive to states experiencing population growth as they would not be adjusted for that growth. Okay, so I don’t know if this is the people designing this who didn’t want to expand, who didn’t think that it’s increasing affordability because it is, that it’s increasing access to care, because it’s bringing people up, and now they’re proposing something that is really about just being attractive if you really just think you’re going to have lower populations and not cover people.

I am interested though because there is a commonality, Mr. Smith, between you and Ms. Miller in that you both support community first choice programs in the context of delivering access to care through more affordable rates. And the 85% of home, community-based care vs. 15% nursing home care, that’s what we’ve been able to achieve in our state. The Graham-Cassidy bill further cuts that incentive there to get states to do that. Wouldn’t that be a huge cost-saver, I’m talking in the tens of billions, if not in the hundreds of billions of dollars, if we could get states to achieve a better balance on community-based care vs. nursing home care? Isn’t that real money.

Miller: I think it would be and that is one of innovations that states can do today under existing waivers.

Sen. Cantwell: Well, Graham-Cassidy actually rolls that back. It dis-incents it. I think we should put pedal to the metal and incent it even more. Frankly about 10 or 15 states have taken us up on it and I think that this is real savings and plus, who doesn’t want to get community health at home. Ms. Mann I see you nodding your head. So this is the right strategy. Our colleagues who say that there’s no savings and changes we can make in Medicaid. Here’s a win-win-win. People would love to stay at home and age. Would love to have care delivered there instead. And guess what, its way cheaper than nursing home care. And if you are going to accept a population of people who are reaching retirement and demanding more of those services then you want to implement something like this and you want to continue to incent it. So, definitely don’t want to… yes, Mr. Smith.

Panelist Dennis Smith, Arkansas Department of Human Services: If I may clarify because I think we are talking about two different programs: the money follows the person, which we created in 1005 and then the Community Choice First provision, which offered an enhanced match, but with that enhanced match states were required to be state-wide. So you could not have any waiting list whatsoever. In Medicaid waivers, and we’ve had 30 years of experience now in home- and community-based waivers, states were allowed to have a waiting list – not under the Community First Choice however. So there are a number of states including Arkansas who could not afford to go state-wide, even with that 6 percentage point enhanced match rate. So again, part of this is, there are both incentives and barriers to be able to do some of the things that were available there.

Sen. Cantwell: You know, I think the issue for us in the Pacific Northwest is that we’re just a little tired of the tail wagging the dog when it comes to these issues. We deliver better care at lower cost, okay? We deliver better care, probably $2-3,000 less per Medicare beneficiary than Louisiana and we deliver better care, okay? So we know what innovation is, and we want to run towards it. Some people want to walk and we get that. We want to run towards it. These are the real savings. So if you cut the innovation out in Graham-Cassidy that is already existing for state flexibility, than you are going to put us even further behind in achieving some of these savings that are really the delivery system side of the case that we have to get to and so that’s my point. Mr. Chairman I see my timing’s expired but I just hope that people will hear what Ms. Miller had said in the first round and that is these are the big things that are going to help save us and drive down cost.