The bill the U.S. House approved last week that covers much of President Donald Trump’s domestic agenda includes new work requirements for Medicaid — the health care program for low-income Americans.
Critics of the proposal worry about potential cuts. An analysis done last week by the Kaiser Family Foundation estimated the bill would lead to around 230,000 Arizonans on Medicaid losing their coverage. GOP supporters of the bill argue they’re not cutting Medicaid, but instead are rooting out "fraud, waste and abuse."
Fewer people on Medicaid would likely have a big impact on hospitals, who are required to care for patients regardless of whether or not they have insurance.
Dr. Robert Trenschel, president and CEO of Onvida Health in Yuma, joined The Show to discuss.
Full conversation
MARK BRODIE: So I'm curious, when you look at this proposal that has passed the House, now moving to the Senate, what might it mean for you and your facility?
DR. ROBERT TRENSCHEL: Well, you know, for, the bill's moved very quickly, obviously, and you know there's been some last minute amendments, and we really don't know the full impact of those. So, you know, first I just want to make sure we urge the Senate to really take a long hard look at this, consult with their constituency, health care providers, hospitals to see how it's going to impact them.
You know, the work requirement that's in the bill today we believe will disproportionately impact rural areas like us in Yuma that rely heavily on agriculture because, you know, many of the individuals that work here that are on Medicaid work in the agricultural industry, and that is not a year-round opportunity for them, you know. They only work part of the year and then the rest of the year they may be uncovered. And we know that health care needs don't go away just because you don't have health insurance.
So you know, we're going to be obligated to treat those individuals, which we happily do, but we need a payer source for those individuals as well, and this could severely impact that, which would severely impact the services we provide to the entire our entire service area, which is a little over 7,000 square miles.
BRODIE: So when you look at what the potential impact could be, and again, you know, there's a lot in this bill that hasn't quite been unpacked. The Senate is, you know, there's a lot of, Republican senators are saying we're going to make some changes to this. So we, the caveat being we don't know exactly what the final version of this bill will be.
But as it stands now, how would you compare the potential impact to maybe what, you know, rural hospitals like yours were talking about, you know, more than a decade ago before Arizona expanded Medicaid?
TRENSCHEL: Yeah, not, not dissimilar, you know, it's not dissimilar. We've had the expanded Medicaid population in Arizona, which has been great. Arizona's never imposed a work requirement. The, so, you know, we don't really know the full impact. What we do know is that it will be less and eventually be more and more less, because inflation goes up, the cost of providing care goes up. And if we have, if we continue to absorb all those costs without a compensatory, some type of offset from a revenue perspective, then, you know, we're looking at making cuts in the organization for really the most vulnerable people.
Because those are our biggest loss losers in the organization, and we sustain those because we are relatively healthy financially, but as soon as you start impacting that with cuts to Medicaid, it impacts the entire health system. That's what a lot of people don't understand.
They say, well, if you just cut Medicaid, you're just impacting, you know, those poor people who don't want to work, which, by the way, is just not true. You know, every person we've ever seen and treated on Medicaid is, you know, if they can work they do, and you know there's no abuse in the system obviously that we see.
But the issue is that cuts in Medicaid are going to impact maternity care, even if you're not a Medicaid patient. It's going to impact behavioral health services, even if you're not a Medicaid patient. Or neonatal ICU. You know, those are our biggest loss leaders in the organization.
So when you cut Medicaid, we're, we're also going to concomitantly look at where do we have to make cuts in the system to absorb that. And unfortunately, it's usually the most vulnerable that get hit, and that's not something that we want to do.
But we also know that rural safety net hospitals like ours, we're the only source that people have here. We're 180 miles away from getting the same level of care that we provide here. You either have to go to Phoenix or San Diego to get the same level of care you get here. So if we close those services, I mean, I don't even know if people can get there.
BRODIE: Do you have a sense of what percentage of your patients are on Medicaid?
TRENSCHEL: Yeah, 24% of our patients are on Medicaid.
BRODIE: Wow, almost a quarter.
TRENSCHEL: Yes, it's significant. 85% of our individuals are government pay, so it's Medicaid, Medicare, and, you know, Champus, Tricare, and that. So we rely heavily on governmental funding. So any, any wobble in that affects our system significantly. And consequently the care we provide for our community, right?
BRODIE: I want to ask you about something that House Speaker Mike Johnson said in response to some of these questions about cutting Medicaid, and he said, and I'm going to paraphrase it, that there's a that it's a moral moral choice that lawmakers were making, Republican lawmakers, the ones who voted for it in this case are making that.
You know, able-bodied adults who are on Medicaid have an obligation to be working or looking for work. I'm curious, and you kind of alluded to this a little earlier. I'm curious what you make of that argument?
TRENSCHEL: Well, you know, work is good. I mean, you know, people wanting to work gives them a sense of purpose, and it's a laudable goal. Unfortunately, you know, you look at the federal poverty level, $32,000 for a family of four. I mean, I don't know who can survive on that, but I guess some people do.
And it's just a tragedy that we think, you know, supporting individuals that need health, that need health care is a, it is a moral obligation to provide that health care. It is a moral obligation to give those people access to health care. I would argue just the opposite side of that.
BRODIE: So understanding again that we, nobody really knows what the final outcome is going to be, how are you and how are, you know, how are your colleagues trying to prepare for potential changes coming down the line, not really knowing what they might be?
TRENSCHEL: Yeah, it's a challenge. It's a big challenge because if you don't know what those changes are, then, you know, all you can do is prepare based on what you think may happen, and that may not be the case. But we are going through those scenarios.
Many of my colleagues around the state are doing the exact same thing, you know, if this cut, if we get this amount of cut, then what is that going to mean? You know, what are the services that we have to look at because it all comes down to services and people.
I mean, it's not like you can just trim a little fat off the system. There is no fat. I mean, health care operates on a 2 to 3% margin, so any, in a good year, so any wobble is just going to cause a significant impact across the system.
