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Extra Opioid Funding Wouldn’t Undo Senate Health Bill’s Harm

Senate Republicans reportedly may add $45 billion over the next decade to their bill to repeal the Affordable Care Act (ACA) in order to address the opioid crisis.  That’s far less than experts estimate we need.  But more importantly, it would be greatly outweighed by the bill’s deep Medicaid cuts and other fundamental changes to the ACA that would cost an estimated 22 million people their health care coverage, leaving many opioid sufferers without the care they need to recover.

The underlying Senate bill would effectively end the ACA’s Medicaid expansion, which has enabled 31 states and Washington, D.C. to provide coverage to 11 million low-income adults; convert Medicaid’s funding to a per capita cap that would not keep pace with Medicaid costs, forcing states to cut eligibility or benefits to make up the difference; increase premiums, deductibles, and other out-of-pocket costs for millions of people with individual market coverage; and weaken or end important protections for people with pre-existing conditions.  As a result, the Congressional Budget Office (CBO) estimated that the bill would cause 22 million more people to go without health insurance by 2026.

In the face of these huge coverage losses and significantly higher premiums, deductibles, and out-of-pocket expenses, the additional $45 billion for the opioid crisis reportedly would come in the form of state grants.  But those grants would prove woefully inadequate because many of those in need would lose their health insurance, leaving them unable to receive the mental and physical health care they need in addition to treatment for their opioid addictions for a successful recovery.  “Are you kidding me?,” Ohio’s Republican Governor John Kasich responded when asked about reports of the added money for opioid treatment:  “… That’s like spitting in the ocean.”

The underlying Senate bill would make the additional $45 billion in opioid funding inadequate in two fundamental ways.

First, the per capita cap on federal Medicaid funding and effective repeal of the Medicaid expansion would cripple Medicaid’s ability to respond to the opioid crisis effectively.  Currently, the federal government pays a fixed share of Medicaid costs in each state, averaging 64 percent across the states.  When Medicaid costs rise, federal funding rises with them.  Consequently, Medicaid can respond to crises when they arise, enabling people to get care where, when, and as long as they need it.  With regard to the opioid crisis, Medicaid spending on drugs for opioid addiction more than doubled between 2011 and 2016, from $394 million to $930 million, the Urban Institute found. The states with the highest rates of drug overdose deaths (West Virginia, Massachusetts, Ohio, Rhode Island, and Kentucky — all states that expanded Medicaid to nonelderly adults) had the fastest growth in Medicaid spending for these drugs.

Targeted opioid funding, like the additional $45 billion, must go “hand-in hand” with health insurance coverage because people “won’t access the treatment without the coverage,” said Senator Shelley Moore Capito, a West Virginia Republican.  Her state had the highest rate of drug-related deaths in 2015 and recently applied for a federal Medicaid waiver to expand the substance use treatment services that its Medicaid program provides.

Due to the per capita cap and cut in funding for Medicaid expansion under the Senate bill, however, West Virginia would need to boost its Medicaid spending by nearly 50 percent just to maintain its current program, let alone expand substance use treatment. And if the opioid epidemic worsens, the state’s costs would rise even more. 

Second, due to the Senate bill’s changes to the individual market, people with private coverage could lose access to treatment for opioid-related disorders.  That’s because the bill would let states waive requirements that health plans in the individual and small group markets cover “essential health benefits,” including behavioral health care, which encompasses treatment for mental illness and substance use disorders.

Overall, the Senate health bill, like its House-passed counterpart, would put an estimated 1.3 million people with a mental health condition and 2.8 million people needing substance use treatment — about 220,000 of whom have an opioid use disorder — at risk of losing treatment for these conditions.  The bills would make it harder to get all forms of health care, including appropriate treatment for substance use disorders. 

Peggy Bailey
Executive Vice President for Policy and Program Development