The House Energy & Commerce Committee released a proposed budget reconciliation bill detailing potential cuts to Medicaid that have prompted home-based care providers and advocacy groups to sound the alarm. The bill, released Sunday, could lead to cuts to the Medicaid budget and limit access to home- and community-based services (HCBS), according to The National Alliance for Care at Home.

“The ongoing conversations around potential reductions to Medicaid spending are increasingly concerning to the Alliance and our provider members that deliver home- and community-based services (HCBS), hospice and palliative care to children with serious health conditions, older adults and people with disabilities,” the Alliance said in a statement. “Although we recognize that leadership in the House and Senate have expressed support for preserving services to these populations, we do not believe that it is possible to reduce Federal Medicaid expenditures by hundreds of billions of dollars over a ten-year period without negatively impacting eligibility and access to care.”

The total amount of proposed tax cuts could reach $4.5 trillion, alongside spending cuts of approximately $4.5 billion, with a significant portion expected to come from Medicaid. It could potentially lead to 9 million beneficiaries losing Medicaid coverage, according to the Congressional Budget Office (CBO). However, the bill is still in development and faces opposition from both sides of the political spectrum.

Investors expected Medicaid to bear a greater share of the weight of the $880 billion cuts requested by Congress, according to a statement from Tao Qiu, an analyst with Macquarie Equity Research. Instead, the total Medicaid savings amount to $172 billion over 10 years, with contributions mainly coming from tighter eligibility, enrollment checks and work requirements.

Several cuts that the CBO outlined as possibilities were not included in the bill, including per capita caps, reduced Federal Medical Assistance (FMAP), Affordable Care Act rollback and provider tax rate cuts.

However, to qualify for Medicaid under the new bill, able-bodied adults without dependents would face new “community engagement requirements” of at least 80 hours of work, education, or service each month. Additionally, program eligibility must be verified twice a year.

The Alliance cited the following reasons for its stance against the bill:

• At the state level, Medicaid funding is fungible and reductions are often distributed across a wide swath of the program.
• Reductions in Federal funding would either require additional state money to backfill the loss – thus pulling resources from other parts of the program – or, more likely, would lead to similar reductions to the state matching dollars, resulting in compounded cuts at the service delivery level.
• Services to older adults and people with disabilities represent over 52% of total Medicaid expenditures, making it nearly impossible to effectuate large reductions in spending without impacting services to these individuals.
• The optional nature of HCBS and the ability to cap enrollment and establish waiting lists creates additional vulnerabilities when Medicaid spending reductions and state budget shortfalls occur.
• Attempts to limit reductions to the “childless adult group” would negatively impact many paid and unpaid caregivers who provide HCBS.

A component of the long-term care benefit, HCBS services consist of a comprehensive set of in-home services and supports for older adults and people with disabilities, according to Damon Terzaghi, director of Medicaid advocacy for the Alliance. These include personal care, home health and home health aide services, supported employment, group homes, adult foster care, home-delivered meals and a wide range of other supports.

Medicaid is the nation’s largest payer for these services, Terzaghi told Home Health Care News’s sister publication, Hospice News. Definitions of HCBS vary among Medicaid programs in different states.

President and CEO of LeadingAge, Katie Smith Sloan, also emphasized Medicaid’s critical role in enabling older adults to have access to care and services by funding and supporting the providers who deliver them.

“Medicaid isn’t just a safety net – it’s a lifeline for millions of older adults and their families,” she said in a statement. “As the number of Americans age 65 and older surges, and the care workforce shrinks, slashing or restricting Medicaid funding isn’t just irresponsible; it’s dangerous. Medicaid is an interconnected ecosystem – if you target one piece, the whole system will be impacted.”

Washington, D.C.-based LeadingAge is an association of more than 5,000 nonprofit aging services providers and organizations.

Jim Parker, Senior Editor, Hospice News contributed reporting to this story.