ACP is pleased that the deal excludes work requirements from being extended to Medicaid
June 16, 2023 (ACP) — Congressional leaders and the president reached a deal at the end of May to raise the debt ceiling limit, effectively averting a potentially significant disruption to health care delivery.
The deal “avoids advancing some of the policies that had been discussed in talks around the debt ceiling that would have done the most harm to federal health programs,” said Dr. Omar T. Atiq, president of ACP. “In the future, policymakers should look for ways that federal policies and programs can be strengthened to improve health and health care for the American people.”
The debt limit refers to the total amount of money that the federal government is authorized to borrow to meet its existing financial obligations, such as Social Security and Medicare benefits, military salaries, interest on the national debt, tax refunds and other payments, explained George Lyons, Jr., Esq., ACP director of legislative affairs.
Raising the debt limit does not equate to new spending, he said, “but allows the federal government to finance existing legal obligations that Congresses and presidents of both parties have made in the past. Failing to increase the debt limit could have catastrophic economic consequences. It could cause the government to default on its legal obligations, raising the cost and jeopardizing the likelihood that government could continue borrowing while precipitating another financial crisis that threatens the jobs, investments and retirement savings of Americans.”
ACP was especially concerned that a default on debt could halt funding for Medicare, Medicaid, medical research, the Centers for Disease Control and Prevention and other vital health programs. As the early June deadline approached, Congress and President Biden reached a compromise deal and averted the default.
“Overall, the deal isn't as bad as it could have been,” Lyons said. “It is noteworthy that the debt ceiling has been raised to cover a period to January 2025. The size of the cuts in discretionary nondefense spending is much lower than the $130 billion contained in the bill championed by Congressional Republicans that passed the House last month. The caps on spending will last for two years rather than for 10 years as provided in that bill.”
ACP is pleased that the deal excludes work requirements from being extended to Medicaid. “ACP has firmly opposed implementing work or job search requirements because they are likely to boost the number of patients without insurance,” Lyons said. “The more difficult it is to apply for and keep coverage, the less likely an enrollee will want to deal with the Medicaid program, leading to an increase in the number of the uninsured. The work mandates are problematic in other ways. They impose additional administrative burden on physicians who will have to sign paperwork if their patients want an exemption.”
It is possible, Lyons said, that conservative Republicans will make future attempts to mandate work requirement measures.
On another front, ACP is disappointed that the bill includes work requirements for the Supplemental Nutrition Assistance Program (SNAP, commonly known as food stamps) and Temporary Assistance for Needy Families (TANF, or cash welfare), both of which already include substantial work requirements. Now, childless adults between the ages of 18 and 54 years who do not have a physical or mental condition affecting their ability to work will be required to work or volunteer for 80 hours a month. If they fail to do so, they can only receive SNAP benefits for a maximum of three months over a three-year period.
“ACP believes that eligibility for food and nutrition benefits should not be tied to work requirements,” Lyons said. “Mandating work does not solve or address underlying barriers that may keep people from working, such as mental health, childcare concerns, lack of skills or inadequate transportation. Most SNAP beneficiaries are already employed or are participating in SNAP short term during periods of unemployment when they need assistance affording food.”
ACP would have preferred that a debt ceiling increase was not tied to spending cuts that disproportionately fall on the poor in an adverse manner and enhance the health equity problems in the country. As Lyons noted, the deal negotiated by the Biden White House and House Republicans cuts some domestic programs in 2024 and limits spending growth to 1 percent in fiscal year 2025. This will still amount to a cut after accounting for inflation.
“Almost two-thirds of the $6 trillion federal budget is mandatory spending on programs like Social Security, Medicare and Medicaid that will happen without any action by Congress,” Lyons said. “The rest is determined by Congress, and that is the bucket that will be affected by the debt limit deal. The cuts are going to land disproportionately on programs that help the poor. Some discretionary spending, on the military and for veterans, is actually going to increase. The exact cuts are supposed to be set by appropriations legislation that Congress will pass later this year. Should Congress fail to pass those spending bills, automatic spending cuts of 1 percent across the board would occur instead, causing additional harm to social safety net programs.”
He added: “By including a 1 percent cut across the board penalty on domestic discretionary spending in the debt ceiling legislation, there is incentive for both Democrats and Republicans to work together and pass the appropriations bills by year end and thus avoid a government shutdown this fall.”