Triggers In Debt Ceiling Deal May Undermine Access To Health Care Coverage, Defund Health Law

Politico’s Jennifer Haberkorn has written sobering report that has some progressives rethinking the argument that the sequestration trigger in the debt ceiling deal may do more to protect health care funding than the super committee’s spending proposal. As it turns out, those triggers — to go into effect if the super committee fails to agree on the necessary savings — would shield Medicare benefits, Medicaid and Social Security from spending cuts, but could still target the discretionary and mandatory spending used to finance implementation of the Affordable Care Act. As a result, the debt ceiling agreement could significantly reduce access to health care for millions of Americans.

Sen. John Barrasso claims that “there are at least 15 provisions of the Obama health care law that will find themselves subject to this trigger if the committee is not able to come up with other cuts”:

The funds for prevention programs and community health centers, grants to help states set up insurance exchanges and co-ops, and money to help states review insurance rates could be slashed across the board if the panel can’t find enough cuts this fall.

Funding for the temporary high-risk pools for pre-existing conditions could be sliced, too, as well as grants to improve maternal and child health. And as previously reported by POLITICO, the law’s cost-sharing subsidies — which are supposed to help low-income people pay their out-of-pocket expenses — could face the ax, too. […]

Senate Republican leadership aides identified the potential funding cuts shortly after the law passed and are talking with the Congressional Budget Office to determine what parts of the law would be subject to sequestration.

As CBPP’s Edwin Park explained it to me — he is also quoted in Haberkorn’s piece — “the sequestration applies to any mandatory spending not specifically exempted. For example, low-income programs like Medicaid and refundable individual tax credits are exempt, so the ACA’s federal funding for the Medicaid expansion and the premium credits are not subject to the automatic cuts. But other ACA mandatory spending wouldn’t fit within those exemptions so things like the grants to states for setting up exchanges, the public health prevention fund, mandatory funding for community health centers, etc wouldn’t be protected.”


It’s worth noting that many of the targeted provisions — prevention, community health centers, high-risk insurance pools — have received bipartisan support and had been touted by Republicans as commonsense solutions for expanding access, creating jobs, and reducing health care costs (particularly during the Bush years). Now, they’ll be used as pawns to appease conservatives who want to see the health law defunded and completely eliminated. And that goal — unraveling the health care law — could very welcome become a reality if individuals are required to purchase coverage (once the mandate kicks in) without sufficient help from the government.

If I see any silver lining in this it’s that Office of Management and Budget — which is housed within the White House — will be responsible for determining how it will carry out the sequestration and HHS Secretary Kathleen Sebelius may have some discretion in how to apply the proportional across-the-board cuts.