You’re Probably Going to Need Medicaid
Many Americans are unaware of the likelihood of their need for insurance through Medicaid, with around one in three people reaching the age of 65 now requiring nursing home care and over three-quarters of long-term home residents eventually needing Medicaid. The proposed American Health Care Act could significant impact Medicaid support, reducing spending by over $800bn and removing another $600bn over a 10 year period. The potential impact for lower-income families has been discussed, but the cuts could significantly affect older or disabled Americans. Two-thirds of all Medicaid spending is currently spent on this demographic, with the proposed cuts likely to cut off access to care for many elderly or infirm citizens.

Much focus has rightly been placed on the enormous damage this would do to lower-income families and youth. But what has been largely missing from public discussion is the radical implications that such cuts would have for older and disabled Americans.

Medicaid is our nation’s largest safety net for low-income people, accounting for one-sixth of all health care spending in the United States. But few people seem to know that nearly two-thirds of that spending is focused on older and disabled adults — primarily through spending on long-term care services such as nursing homes.

Indeed, Medicaid pays nearly half of nursing home costs for those who need assistance because of medical conditions like Alzheimer’s or stroke. In some states, overall spending on older and disabled adults amounts to as much as three-quarters of Medicaid spending. As a result, there is no way that the program can shrink by 25 percent (as under the A.H.C.A.) or almost 50 percent (as under the Trump budget), without hurting these people.

A large body of research, some of it by us, has shown that cuts to nursing home reimbursement can have devastating effects on vulnerable patients. Many nursing homes would stop admitting Medicaid recipients and those who don’t have enough assets to ensure that they won’t eventually end up on Medicaid. Older and disabled Medicaid beneficiaries can’t pay out of pocket for services and they do not typically have family members able to care for them. The nursing home is a last resort. Where will they go instead?

Those who are admitted to a nursing home may not fare much better. Lowering Medicaid reimbursement rates lead to reductions in staffing, particularly of nurses. Research by one of us shows that a cut in the reimbursement rate of around 10 percent leads to a functional decline of nursing home residents (that is, a decline in their ability to walk or use the bathroom by themselves) of almost 10 percent. It also raises the odds that they will be in persistent pain by 5 percent, and the odds of getting a bedsore by 2 percent.