What Medicaid Cuts Mean For Americans, Part II

0:07Medicaid is a cornerstone of the American health care system. The federal program provides health insurance to more than 70 million low-income people and people with disabilities. But that's about to change. According to estimates by the Congressional Budget Office, Medicaid will lose$1 trillion over the next 10 years, and 10 million Americans could become uninsured by 2034. This is the result of President Trump's signature tax and spending bill he signed into law earlier this month. You can find the podcast with our overview of these cuts in your podcast feed. However, we ran out of time to answer all of your questions, so we're bringing you a part two.

0:46Today, we look at three specific ways this bill could affect Medicaid coverage in the U.S. First, people in the country with legal status. They'll be hit hard by these changes. We discuss who loses eligibility for Medicaid under the new rules. Next, we hear from the CEO of 25 Nursing Homes in Texas, who says these cuts could upend the industry and leave seniors behind. And finally, how could changes to Medicaid cut off treatment for many across the U.S. struggling with substance use disorder? I'm Jen White. You're listening to the 1A Podcast. We'll meet our panel after this short break. Stay with us.

1:25Let's jump in and meet our panel. Julie Rovner is Chief Washington Correspondent for KFF Health News. She also hosts the weekly health policy news podcast, What the Health? Julie, thanks so much for coming back. Always a pleasure. And we're starting the conversation with a look at how these cuts will affect lawfully present people in the country. So here to talk us through that is Leo Cuello, research professor at the Georgetown University Center for Children and Families. He's an expert on Medicaid law and policy and worked for the National Health Law Program, which advocates for health care access for underserved groups.

1:57Leo, welcome to the program. Thanks for having me, Jen. And if you have questions about Medicaid changes, send them our way, 1A at WAMU.org. So let's first talk about coverage under the current rules. Here's Press Secretary Caroline Levitt talking about Trump's tax and spending bill and the changes it makes to Medicaid. The one big, beautiful bill also strengthens and protects Medicaid benefits, despite what Democrats are saying, for eligible American citizens who rely on it, like pregnant women, children, seniors, and people with disabilities, by eliminating waste, fraud, and abuse that threaten to destroy this program that was intended for the most vulnerable in our society.

2:36And every single Democrat in Congress is against rooting out that waste, fraud, and abuse and blocking the 1.4 million illegal aliens who are currently improperly receiving these benefits that should be going to American taxpaying citizens. So, Julie, first let's do some fact-checking here. Do people in the country without legal status qualify for Medicaid coverage? It depends. Basically, effectively, no, and they don't qualify for federal funding. There are a few states that cover people who are not here with legal status with using their own state money. This bill originally would have punished those states, but the Senate parliamentarian said that the Senate couldn't do that.

3:18So that part got dropped out. Although we do know that some of the states are cutting back anyway. But no, there is no federal funding available for people who are not here with legal status. So which non-citizens can access Medicaid coverage under the current rules? So this is a complicated issue that was fought over heatedly in 1996 when Congress passed a big welfare reform bill. If you recall, that was a Republican Congress and President Clinton. So it was a bipartisan bill. And they did cut back the availability of many benefits for people who are here with legal status but who are not citizens.

3:55So, you know, legal immigrants. And there were a lot of exceptions so that people who were here legally could get certain types of federal benefits, health care included, Medicaid included. This would cut back virtually all of that. So basically it says, I guess as the president's press secretary was saying, if you're not a citizen, you're not likely to be eligible for a lot of these programs. And that's a big change. Leo, is it clear where the press secretary gets this$1.4 million number from? It's not clear. And I think it obfuscates the broader point, right? The broader point is there are 10 million people who will lose health insurance.

4:36These are not undocumented people because, as Julie said, they are not eligible for full Medicaid coverage. The majority of them, the large majority, are U.S. citizens. And in terms of immigrants, which are a much smaller group, the bill does target immigrants, but those are all legal immigrants, people who are lawfully present here. And the bill will have a devastating impact for those lawful immigrants because of the specific policies in the law, but also in combination with the broader context of what else is going on. So how is coverage being cut for non-citizens who are currently covered by Medicaid?

5:11How does it narrow who's eligible? Right. So in Medicaid today, it's complicated, as Julie said, because you have lawfully present people who are eligible for Medicaid and you have lawfully present people who are not eligible for Medicaid. There are just some groups of lawfully present people who are eligible. So what this law does is reduce the number of groups eligible. So if you can kind of imagine that today there are 10 or 12 groups of lawfully present immigrants who can qualify for Medicaid under the law starting October 2026, there will only be three groups that qualify. So many groups of lawfully present immigrants will lose their Medicaid eligibility.

5:53And how is coverage being cut for noncitizens and other federal health programs? So thinking of things like CHIP, which is the Children's Health Insurance Program. So the CHIP rules mirror the Medicaid rules for this general immigrant eligibility. So it will be the same exact impact. The lawfully present children will lose coverage unless they're in one of the three groups that remain. In Medicare and Marketplace, they do similar things. They reduce the scope of eligibility from a broad range of lawfully present immigrants to only three groups of lawfully present immigrants, meaning a whole bunch of lawfully present immigrants will either lose their Medicare or, in the marketplace, lose the subsidies for marketplace coverage.

6:40Julie, we talked last week about how many of the changes in this bill will take months, if not years, to fully go into effect. What's the timeline for most of the significant changes to coverage for this population? This population is going to lose coverage much more quickly and combined, as we've been talking about, with new eligibility checks. So we would expect that this is probably going to be the first population that we're going to see some of these reductions. Leo, when we think about the landscape of health care and health care access in this country, what do these changes mean for the United States and its health care infrastructure?

7:23Yeah, so I think you have to think of this in a lot of ways. The first thing you need to realize is that the immigrants we are talking about are in families. And so this actually doesn't impact just individuals. It impacts entire families. For example, you may have a child that will be less likely to have health coverage because of what happens to a parent. So you're talking about our current workers, right, because immigrants make such an important part of our U.S. workforce. You're talking about our future in terms of the children who are one day going to be our leaders. When you also remove a lot of people from the health care system, of course, that is going to drive up uncompensated care for all of the health care providers, right, the hospitals that are taking care of people.

8:03And so what that means is a lot of instability in that system. It's going to mean more cost shifting, more losses for hospitals. And all Americans will see that through increased health care costs. Your premiums will go up. Your deductibles will go up. Your cost sharing will go up as those costs get passed back to everybody who does have insurance. Well, and Leo, I want us to be specific about who is able to access Medicaid under the current rules. When we talk about people in the country with legal status, what type of status are we describing? So the groups of people who are currently covered and will lose coverage are incredibly vulnerable groups.

8:44It includes refugees, people granted asylum, political asylum, victims of human trafficking, victims of domestic violence, and sometimes their children who can qualify for Medicaid. Individuals granted admission due to an urgent humanitarian reason and other groups. all of those groups will lose their Medicaid health insurance. And note, of course, these are people who follow the rules. They're here lawfully. But they're also generally being admitted to be a permanent part of our society. Almost all of them can be on a pathway to permanent residence. And if they choose, maybe one day citizenship.

9:19So as I said before, it's not a smart long-term strategy to be locking them out of the health system now. Well, last month, the AP reported that Immigration and Customs Enforcement, or ICE, will be given access to Medicaid data. Last week, the AP reported on an updated agreement that will, quote, allow ICE to receive identify, to receive identity and location information on aliens identified by ICE, end quote. ICE acting director Todd Lyons confirmed this reporting on CBS on Friday. What ICE is doing is working with all of our other federal partners to try to gain intelligence to locate these individuals that have been ordered, deported by a judge or have been released from a sanctuary jurisdiction like we talked about.

9:59That is what ICE is using that data for, whether it be data from the Department of Labor, data from health and human services, Medicaid. We are using that data to try to locate, again, the worst of the worst of those people that are lawfully deported. So I think that's what you're going to see that data used for. Julie, what more can you tell us about this agreement? Well, there's a couple of things going on here. First of all, there is a concern that people who remain eligible for health coverage won't get it because of this. because families, many families, as Leo said, are of mixed immigration status.

10:31The children may be citizens. The parents may be here legally. There may be a grandparent that's here without documentation. And we do know that ICE is basically collecting people who are not necessarily the worst of the worst. So there is definitely a concern about people not seeking health care as a result of this one change. Leo, federal health officials initially said the goal was to remove people who were improperly enrolled in the program, but what do we know about the data being shared and what it can be used for? Right, so HHS spokespeople have said that this is to, quote, make sure illegal aliens aren't getting Medicaid benefits, but we heard the quote you played where we have ICE saying it's to locate people for immigration enforcement.

11:15So that's two problems. Number one, they're taking what should be confidential health information that should be shared only for health purposes, and HHS is releasing it to immigration enforcement, not health. Huge legal problems with that. The second problem is it's obvious that HHS, what they're saying is not true here because it's not to make sure that illegal aliens don't get benefits. Most of the data shared is for citizens, sometimes lawful residents. And the only information that involves the undocumented is related to emergency treatment, which is permissible under the law. So the information that's being shared is addresses to find people for enforcement.

11:57It's not actually to identify any impermissible treatment because it's all for permissible coverage. Well, Julie, earlier this month, 20 states sued the Trump administration for sharing private Medicaid data to deportation officials. What's their legal argument? Well, the argument is really a public health argument that if people are afraid that their location data is going to be shared, they're not going to come forward for needed medical care. And the reason that Medicaid is allowed for people who are undocumented in emergency situations is that we want people, particularly with communicable diseases, to come forward when they need emergency medical care.

12:36The idea of driving people sort of under the shadows is not good for the health of everybody else who's here. So that's the main reason why immigration officials have not been allowed into health facilities traditionally, into community health centers, into hospital emergency rooms, because we want people who need care to come forward regardless of their legal status. The other thing is that we now have a number of populations in this country who've been here legally, who came here legally, whose legal status is being revoked by the Trump administration. So we have a number of people who were documented who suddenly aren't.

13:15So that's throwing things into a bit of an uproar, too. Leo, we can talk about rules changing and statistics and data. But when you look at this through a public health lens, what do you think we overlook in this conversation that we need to consider as these changes go into effect and we look at the impact of the changes into the future? I think it's important for listeners to understand that during the first Trump administration, we saw the administration reverse longstanding policies in a way that was just scary for immigrants, including U.S. families that have an immigrant in them, and scared them away from using health care.

13:54There was what you could call a strategy of creating a chilling effect for immigrant health care. And we see that happening again now in a lot of ways. First, the sharing of data with ICE, as we just discussed, so that families with immigrants are afraid to enroll in health care. But second, for example, the administration in January reversed immigration enforcement policies that were to avoid enforcement at sensitive locations, like churches, like schools, like health centers, because obviously it is bad policy to have members of a community avoiding their church, kids avoiding schools, and people going into labor avoiding going into an emergency room.

14:36Well, that's Leo Cueo. He's a research professor at the Georgetown University Center for Children and Families. He's an expert on Medicaid law and policy and worked for the National Health Law Program, which advocates for health care access for underserved groups. Leo, thanks so much for talking us through this. Thanks so much for having me. Let's take a quick pause here. We'll be back with the conversation in just a moment. Stay with us.

15:02And let's move now to an industry that some say could be totally upended by the Medicaid changes. Medicaid is the primary provider for 60 percent of nursing home residents. That's according to the American Health Care Association. Lori Strube is the CEO of Focused Post-Acute Care Partners. That's a long-term care provider that operates 25 skilled nursing facilities throughout Texas, including in rural areas. And she joins us now to talk about what these Medicaid cuts could mean for residents and the facilities. Lori, thanks for joining us. Thank you for having me. Well, first, let's hear from Democratic Senator Jack Reed of Rhode Island on what he thinks these cuts will mean for nursing homes.

15:38Medicaid is a lifeline for seniors. More than 7 million seniors get care through Medicaid. And two in three nursing homes residents pay for that care with Medicaid. The bill we are voting today takes away key revenue sources for states and nursing homes. Brown University School of Public Health has estimated that 579 nursing homes nationwide would be at risk of closing because of this bill. And even if nursing homes do not close, then they will have to reduce their beds. Julie, quickly walk us through what's in this bill that could affect nursing homes. Well, one of the big pieces of this bill that nursing homes are very unhappy about it changes the way states are allowed to raise their share of the funding for Medicaid.

16:34And this is something that's common for nursing homes, also for hospitals, that states will basically levy a tax on the nursing homes. The nursing homes will pay the tax. The states will use that as part of their share of Medicaid to draw down the federal funding, and then it basically goes back to the nursing home. It's a gimmick. There's no question. But it's also the way Medicaid is funded. So without it, it's going to be really difficult for a lot of states to put up their share of what's needed. As we've just heard, Medicaid pays more than half of the nation's long-term care bill as it is.

17:11Lori, describe your organization and the communities your facilities serve. Well, we have 25 nursing homes throughout the state of Texas. We have a combination of homes that serve an urban population as well as a rural population. And we serve many of our anywhere from acute level patients to high acute level patients to behavioral patients. Well, we got this email from Mary who says, I'm most concerned about nursing home residents who are on Medicaid. Already, the owners of nursing homes say they are not getting enough reimbursements for the people who are residents. In Pittsburgh, many nursing homes have closed.

17:54There are not enough aids and services are strained. Residents are worried they will lose their places and have nowhere to go. And Tom emails, I suspect this will reduce available beds significantly in care facilities as many rely heavily on Medicaid funds. So, Lori, how might these new Medicaid changes affect the nursing homes you oversee? What are you anticipating? Well, I think that the issue really becomes how do we as a business best manage our revenue sources and cycles? And I think that the answer to that is we faced tough, challenging times before when people were screaming, the sky is falling.

18:31And at the end of the day, we're still providing quality care to our residents. But for the record, as an example, our Texas Medicaid rate covers our halls, our walls, and our food. In that, we also do nursing care activities, therapy, staffing, transportation for roughly the same amount of money that one would spend to stay at a Holiday Inn Express without any of the services that I mentioned. So I think we'll have to do what we did during the COVID pandemic, which is we're going to have to figure out a way to respond rather than to react. And yes, I do believe that there's going to be Medicaid cost shifting, and it will tighten future rate increases for us.

19:20So I just want to try to interpret what I'm hearing you say there, Lori. You're describing Medicaid basically covering the basics, the bricks and mortar, the food, the things that people need to survive. But the enrichment, the things that improve quality of life, that's where you'll feel the pinch most acutely?

19:43Absolutely. I believe that we cover all of that now with our current Medicaid rate, but that's just going to get tougher and tougher as the years go by and inflation hits us. Julie, what do we know about the national impact these Medicaid cuts could have on nursing homes and their residents? Well, of course, one of the things is that what we talked about in the last block, the immigration debate, is also going to impact this. because so many of the workers in these nursing homes are immigrants from, you know, doctors and nurses down to aides, particularly in rural areas. They're heavily staffed by immigrant workers.

20:23So if there are fewer immigrants, then they're going to have trouble finding staff. And if they have trouble finding staff, they may have to raise or try to raise wages. So there's this double whammy on nursing homes. But there is a real concern about what is going to happen. Medicaid, as we've heard, already pays less than many other payers and most other payers for nursing home care. It's barely enough for many facilities to continue. And if it gets cut off or if rates go down anymore, many nursing homes are simply not going to be able to keep their doors open. We got this question from Mary in Cincinnati who emails, I have a relative who needs to move full nursing care.

21:04If a facility has a large number of Medicaid recipients, is that facility more likely to close? Julie, what can you tell us? It depends. You know, sometimes facilities won't take people if they are about to, if they think they're coming in with Medicaid coverage, because they simply can't afford to have that many of their population in Medicaid beds. Often people spend down to Medicaid. They enter a nursing facility with some other sort of coverage, and then they basically spend all the way down and end up having Medicaid cover them. So that's also been an issue for nursing facilities. Let's listen to a voicemail we got from Dave in Colorado.

21:46I am retired, and I'm about to sign up for Medicare, and I would like to know how all the Medicaid cuts relate to me. Hopefully, I won't be in nursing home for many, many years, but that would be one possibility. But how does it interrelate to me? Are they trying to tell me I'm going to have to start working again or volunteering 20 hours a week? David, thanks for that question. Julie, let's first start with that work requirement concern David has. Yeah, the work requirement is for Medicaid. It's also for people only up to age, I believe it's 64. So if you're 65 and retired and on Medicare, the work requirement isn't going to impact you.

22:28However, you know, one out of every five Medicaid recipients also has Medicare. So Medicaid covers a lot of people who are elderly and low income. Basically, once you get on Medicare, if you spend, if you don't have any more money, then you can be on Medicaid as well. They're called dual eligibles. So there are a large number of people who get both Medicare and Medicaid. And so to that extent, people on Medicare could eventually be impacted by the Medicaid cuts because there are so many of them. In 2022, Texas and Nebraska had the most nursing home closures of anywhere in the country, 22 closures out of the 135 across the U.S.

23:13Lori, your organization has, as you said, facilities in both urban and rural areas. How are rural communities in Texas particularly vulnerable when it comes to these cuts? Well, I think that, you know, we do have to take that on a case-by-case basis. And it needs to be thoroughly studied, but that takes time. And we might have to find a way to repurpose or reconfigure ourselves to continue to offer the same services that we're offering today. And again, that takes time for us to respond to that appropriately as opposed to reacting to it appropriately. What are the questions you're asking yourself in relationship to these changes and what it means specifically for your rural facilities?

24:00Staffing. Staffing is a big question that I'm asking. how is it we're going to continue to staff, especially if we don't continue to receive rate increases because it's a fair assumption on our staff's part that they, and it's a fair expectation on their part that they continue to be compensated for the work that they do. And I need to have the funds in order to be able to staff. And if I don't have the staff, then what am I gonna do? And will I look at closing? And if I have to look at closing buildings, where are these people going to go? Julie, put this in context with some of the changes the Trump administration is considering for people who work in health care.

24:47They're thinking about rolling back certain Obama-era protections, including standard minimum wage, pay for overtime. How does that potentially exacerbate the availability of care, especially at long-term facilities? Well, again, as we mentioned with immigration, you know, they're rolling back a lot of these protections for workers as well. It's going to make it harder to get some of these workers. It's going to, you know, press some of these facilities to raise wages in order to get workers. You know, the idea behind these cuts at the federal level was that states should be stepping up more. and spending more.

25:25But unlike the federal government, states have to balance their budgets every year. States already pay, Medicaid is usually the second largest or in some cases the largest expenditure for states, either right before or right after K-12 education. So states are basically going to be faced with this difficult, do they want to raise taxes? Because that's the only way they can get more money. Do they want to cut services? That's basically where we are. And that's what we're looking at for a lot of these things. You know, this care is needed. I don't think the federal government, it says they're repealing anything that's unnecessary.

26:03They're just saying that they shouldn't, they, the federal government, shouldn't be paying for it anymore. Lori, what are you telling those who are concerned for their family members right now? I'm telling them the same thing that I mentioned to you. As long as their family member meets medical necessity and they qualify for Medicaid, then that isn't going to change. And we will get through it. We've, again, faced really tough, challenging times in the past, and we've come through it, and we're still here today. And we will continue to be here tomorrow. That's Lori Strube. She's the CEO of Focused Post-Acute Care Partners.