WASHINGTON, D.C. — The Republican-led U.S. Congress, under pressure from President-elect Donald Trump to move quickly, took its first step toward dismantling the Affordable Care Act this week as both chambers passed a bill instructing key committees to draft legislation to repeal it.
The move came the same day N.C. lawmakers filed a complaint in the Eastern District asking judges to stop Gov. Roy Cooper from expanding the state’s Medicaid program under the Affordable Care Act.
It also coincides with Cooper announcing the appointment of Mandy Cohen, chief operating officer and chief of staff of CMS, to be the new secretary of the N.C. Department of Health and Human Services. Cohen was instrumental in setting up the Affordable Care Act, also known as Obamacare, and was likely to be replaced by the incoming Trump administration. Instead, Cohen will be headed south to run NCDHHS for Cooper.
“I’m thrilled to welcome Dr. Cohen to our team,” said Cooper in a statement. “Her background as a doctor and common-sense problem solver make her the right person for the job at the right time.”
Cohen will likely serve out the last week of President Barack Obama’s tenure, during which CMS is expected to approve Cooper’s request to unilaterally expand Medicaid without legislative approval. However, in 2013 the N.C. General Assembly passed a law that forbid any government agency or branch from committing the costs of Medicaid expansion without legislative approval.
Immediately after Cooper requested the expansion, state Republican lawmakers strongly criticized the move and asked a judge to stop it. Also, a coalition of N.C.’s delegation to the U.S. House wrote a letter to CMS urging them to reject the request, not just because it is against state law, but also because Trump has pledged to repeal the law that supports expansion. The letter was signed by Reps. Richard Hudson, Mark Meadows, Robert Pittenger, Mark Walker, David Rouzer, Ted Budd, George Holding, Patrick McHenry and Virginia Foxx, all Republicans.
“Any governor of North Carolina does not have the legal authority to submit a Medicaid expansion plan to CMS,” the letter read. “It is unfortunate that one of Mr. Cooper’s first actions as governor is to directly go against the same state law and Constitution he swore to uphold.”
Under Obamacare, the federal government has promised to cover 95 percent of the expansion for the first three years, and 90 percent after that. However, concern among critics is that the federal contribution is far from guaranteed as new lawmakers take office and the federal government racks up a deficit that is currently $441 billion.
If the fed changes the rules on its Medicaid contribution, that additional cost – or the tough move to cut Medicaid rolls – would fall to future state lawmakers and taxpayers.
The expansion would pull into the system primarily working-age, childless adults without disabilities. They earn more than the poverty level and don’t fit into one of the other categories that would qualify them for Medicaid, such as dependents, disabilities or pregnancy.
Cooper says it will create tens of thousands of jobs across state government and the health care industry.
“We can receive between $3 billion and $4 billion to pay for care that hospitals and other providers now give away,” Cooper said in a statement after he filed the request to expand Medicaid in N.C. “That will create jobs, bolster our hospitals, could save some rural hospitals and work toward more stable private insurance premiums.”
The cost to the state and the unclear future of the Affordable Care Act has many fighting the move and questioning the claims of net job growth.
A study from the National Bureau of Economic Research found that prior Medicaid expansion programs dropped the chance of an enrollee gaining employment by approximately 10 percent, often because they would lose benefits by take a job earning over the threshold. The dynamic is called a “welfare cliff” among economists.
Cohen’s appointment, as with all of Cooper’s agency picks, will now go before the N.C. Senate for confirmation. Members of the state legislature have said Medicaid reform remains a top priority item as they convene at the end of January.