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Jonathan H. Adler | 11.23.2021 10:52 AM
Among the provisions of the House-passed "Build Back Better" spending bill are provisions that cut federal health care funding in states that have refused to expand Medicaid under the Affordable Care Act. In the Wall Street Journal, Chris Jacobs argues that this violates conditional spending holding of NFIB v. Sebelius.
Seven states, including expansion and nonexpansion states, still use uncompensated-care pools to reimburse providers for charity treatment. Section 30608 of the Build Back Better bill contains two separate provisions that would apply solely to nonexpansion states. The first would reduce by 12.5% their Medicaid disproportionate-share hospital payments, which offset the costs of hospitals that treat high numbers of uninsured patients.
Some states have availed themselves of Section 1115 Medicaid waivers, which allow them to pay hospitals for uncompensated care using federal dollars. The Build Back Better bill would ban nonexpansion states from reimbursing hospitals for uncompensated care provided to patients who would be eligible for Medicaid if the state expanded.
So, as Jacobs explains, the BBB bill cuts funding in states that refused to expand Medicaid. While the bill also expands health insurance subsidies for those potentially affected by these limits, Jacobs notes, these subsidies sunset, while the cuts in funding are permanent.
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