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Blog: At What Cost Will States Balance Their Budgets?

May 24, 2011 | By Casey Schoeneberger

H.R. 1683, deceptively titled the State Flexibility Act, puts children, the elderly and disabled people in grave danger, and if passed, would leave hundreds of thousands people uninsured. Passed in the House Energy and Commerce Health committee, H.R 1683 would repeal the Maintenance of Effort (MOE) requirements for Medicaid and the Children’s Health Insurance Program. Those MOE requirements require that states maintain eligibility level and enrollment standards as they existed prior to the passage of the American Recovery and Reinvestment Act (ARRA) and the Affordable Care Act.

Due to increasingly tight state budgets, many Republican Governors have requested the repeal of these requirements for more flexibility in how they spend money, thus providing states with the ability to drop people from the CHIP and Medicaid programs.  Without MOE requirements, states will have the “flexibility” to cut Medicaid beneficiaries or Children’s Health Insurance Program recipients (CHIP) straight out of the medical system, with the consequences falling devastatingly hard on children, people with serious mental illness and individuals with chronic health problems.

The Congressional Budget Office (CBO) estimated that if H.R 1683 were enacted, 400,000 people would lose Medicaid or CHIP coverage in 2013 alone, with two-thirds of dropped enrollees being children.  While some members of Congress no doubt will claim that they did not intend for this proposed legislation to effect children so harshly, amendments exempting children and senior citizens in nursing homes from the repeal of MOE requirements were defeated in the committee by Republicans along party lines.

These ill-directed efforts to balance state budgets are blatant attempts to punish people in poverty for the states’ budget problems and will merely condemn more Americans to life without even the most basic medical care. No matter how unbalanced state budgets may be at t