My colleague Sarah Lueck noted yesterday that the House will vote this week on a bill that would undermine health reform by repealing federal funding to set up health insurance exchanges in the states. Today, House and Senate sponsors will introduce bills that would undermine health reform in a different way: by repealing the law’s “maintenance of effort” provision. As our February report on this issue explained:
The Affordable Care Act requires states to maintain their current Medicaid and Children’s Health Insurance Program eligibility standards until 2014, when new, nationwide Medicaid eligibility standards take effect and state-based health insurance exchanges will begin operating. However, citing state budget problems, a number of Republican governors have asked Congress to repeal these “maintenance of effort” provisions so that they can reduce Medicaid and CHIP expenditures by covering fewer people.
Repealing the maintenance-of-effort provision would almost certainly result in a sharp increase in the number of Americans who are uninsured, as states scale back eligibility for low-income children, parents, seniors, and/or people with serious disabilities — the principal groups of people whom Medicaid covers. During the recession of the early 2000s, some 34 states cut back Medicaid and CHIP eligibility — causing 1.2 million to 1.6 million low-income adults and children to lose coverage — before Congress acted to prevent states from making further eligibility cuts as a condition of receipt of federal fiscal assistance enacted in 2003.
State budget shortfalls are substantially larger today than in those years; states face estimated shortfalls of about $125 billion for state fiscal year 2012, which begins on July 1 in most states. In addition, many governors have said they oppose any revenue increases to help close these shortfalls, despite the magnitude of the budget gaps. . . .