D.C. Auditor: Proposed Changes to Affordable Care Act Could Be ‘Catastrophic' for District Residents

Tens of thousands of Washington, D.C., residents could be left without insurance or the District would have to spend hundreds of millions of dollars per year to fill the gap if the Affordable Care Act is repealed or significant changes are made to Medicaid, according to a recent audit.

"It would be catastrophic, most of the changes that the Republicans have been talking about," D.C. Auditor Kathy Patterson told the News4 I-Team.

D.C. was among the first in the nation to implement key parts of the Affordable Care Act -- largely because the District was already operating its own locally funded health insurance program at the time.

Many of those participants switched over to "Obamacare" once the Affordable Care Act came into existence, saving the District millions of dollars each year.

Under ACA, the percentage of uninsured District residents dropped to below 4 percent, the second lowest in the nation.

"My big concern when the Trump administration came in and started talking about repealing Obamacare is how much it's going to cost," said Council member Jack Evans, who chairs the D.C. Council Finance Committee. "What if they're successful?"

Evans asked Patterson to have her staff run the numbers and issue a report on the impacts a repeal of "Obamacare" could have, both financially and medically.

"What we worked from were some of the bills that had already been introduced, including the one that had passed the house in the last couple of years," said Patterson. "And it would be huge financially, I think close to 600 million lost federal dollars the first year."

The District would lose an estimated $563 million in federal funding in the next fiscal year alone if Congress repeals the Affordable Care Act's Medicaid expansion, the report says.

Even with conservative growth estimates, the District could lose more than $1 billion each year by 2028.

That number jumps to $2 billion a year if Medicaid is converted to a per capita allotment or block grant.

"Everyone is assuming that the Senate won't act. The Senate is likely to act," said Patterson. "It will be a while, it'll be different from the House's bill, but I think we have to be prepared for some action that will cost us federal funds."

As the longest-serving member of the D.C. Council, Evans remembers a time when the District was not flush with cash.

"All my colleagues on the council know is money is growing on the trees, let's spend it, and I think it's going to be a rude awakening for many of them," he said. "We would have to really sit down at that point and figure out what we can do and what we can't do."

The auditors said the repeal of ACA could also create issues for district residents with federal subsidized health insurance through DC Health Link, the District's locally run health benefits exchange. But the D.C. Council could take further action, including providing local funds to continue to subsidize coverage.

The analysis also noted there could be additional economic costs as well: An estimated 8,000 jobs lost and an increase in employees missing work due to illness.

When the I-Team asked if the District could come up with $600 million a year, Evans replied, "We could. We wouldn't be able to do it immediately. We'd have to phase it in over time."

D.C.'s newly passed budget does not factor in this possible new expense, but Evans said the District currently operates with a $200-$300 million surplus each year.

"What it would mean, though, is we would have to dedicate our expanding revenue money to that," he said. "It would then mean that we couldn't spend it on something else."

The News4 I-Team also checked out the impact proposed changes could have in Maryland and Virginia.

In Maryland, a Department of Legislative Services study found the loss of enhanced federal funding for the Medicaid expansion could cost more than $1 billion in the first fiscal year.

Virginia opted not to expand Medicaid but will still feel significant impacts.

Almost 400,000 Virginians signed up for health insurance through the federal exchange. About 80 percent of those rely on federal subsidies to keep their coverage.

Children's health programs could also take a huge hit -- an estimated $68 million in Maryland and about $114 million in Virginia, and that's just in the first year.

Senators have proposed several versions of plans to repeal and replace the current system. The Senate leadership has said it would like a vote before Congress's August recess.

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