Health care repeal-and-replace could cost SLO County $6 million 

As they move toward finalizing a $590 million budget for 2017-18, SLO County officials are unsure exactly how the potential changes to federal heath care laws could impact the county’s finances.

According to county staff, the repeal and replacement of the federal Affordable Care Act (ACA) could jeopardize access to health care for thousands of its residents, and potentially leave the county on the hook for $6 million.

During a May 17 presentation to the SLO County Board of Supervisors, County Budget Director Emily Jackson said that an estimated 16,500 residents obtained health care coverage under the ACA, which expanded eligibility for federally and state funded Medicaid and Medi-Cal. That expansion helped reduce the cost for the county to provide health care to indigent residents dramatically.

“The implementation of the ACA resulted in considerable savings for the county, due to the changed role in providing health services to indigent residents,” the county’s proposed budget document stated.

But changes to the federal Medicaid program included in the Republican-backed American Health Care Act (AHCA) could result in those cost savings disappearing. The current version of the AHCA, which was passed by the House in early May, would limit Medicaid expansion in states and change the way the federal government doles out the Medicaid funding to states from issuing matching funds to using a per-capita formula or issuing states a block grant instead.

“The [AHCA] would not only basically eliminate funding for the Medicaid expansion, but also cut funding for the existing Medicaid program,” said Cynthia Cox, associate director for the Henry J. Kaiser Family Foundation, a nonprofit organization that studies and tracks national health care issues.

According to the Congressional Budget Office, the bill would cut Medicaid by an estimated $839 billion over the next 10 years, and Cox said that states and counties like SLO would be left on the hook to try and make up that gap in funding.

“The amount of money the states would have to make up would be nearly impossible,” Cox said. “If they could do it, it would come at a significant cost to other programs.”

According to Jackson, it would cost SLO County about $6 million to provide health care to the residents covered under the ACA’s Medicaid expansion. That money would come out of the county’s general fund, she added.

As of May 17, the AHCA still had to pass in the Senate, which could make additional changes to its provisions if approved. How any such changes might impact the county budget, remains unknown.

“At this point, it’s still unclear what those changes will be,” Jackson said.

The current proposed county budget assumes the ACA will remain in place, but Jackson said the county will continue to monitor any changes to the federal law. If anything does change, the budget would likely have to be adjusted mid-year to fulfill the legal requirement to provide health care to indigent residents.

Hearings for the SLO County 2017-18 budget will run from June 12 to 14.