Small towns, big stakes: How medicaid cuts threaten health care in the Adirondacks

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2 days ago

— This story first appeared in New York Focus, a non-profit news publication investigating New York state politics. Sign up for their stories at nysfocus.com/ newsletter.
John Rugge has spent half a century building a network of health clinics in the isolated villages and towns of New York's Adirondack mountains. Now 80 years old, as most of his peers enjoy retirement, the locally celebrated outdoorsman and physician is organizing other rural doctors and community leaders in this strongly Republican part of the state to protect the health care system in the face of proposed cuts to Medicaid under debate in Congress.
Rugge says the federal cuts in health care spending — projected at $715 billion over the next 10 years — could have a devastating impact, not just on the New Yorkers who will lose insurance, but also on the rural hospitals, nursing homes, and clinics that rely on Medicaid payments. If a hospital or nursing home is forced to lay off workers or to close entirely, he said, everyone in the community suffers, including those who have private insurance or enough money to pay out of pocket.
'It hurts the institutions, and that means it hurts everybody,' said Rugge. A canoeist and author of The Complete Wilderness Paddler, Rugge founded a clinic in 1974 that has grown into the Hudson Headwaters Health Network, which includes 26 clinics serving 9,400 patients each week.
'What we could see is a medical desert from Glens Falls to Plattsburgh,' a vast area stretching from below the Adirondack Park to the Canadian border some 114 miles away, he said.
AGING POPULATION
The Adirondack region includes six million acres of protected wilderness, featuring mountains, rivers, and lakes beloved by hikers and canoeists. The Adirondack Park is a checkerboard of public and private land, with 105 villages and towns — some home to just a few hundred people — scattered across rugged terrain. Vacationers crowd the region in the summer. Skiers come in winter.
But the year-round population is small, declining, and aging. Many residents patch together part-time and seasonal jobs — work that doesn't come with health insurance. Twenty-eight percent of the residents in the congressional district that includes the Adirondacks rely on Medicaid, the federal-state health insurance program for low-income people. Half of births and two-thirds of nursing home residents are covered by Medicaid.
HEALTH CARE CUTS
Rural hospitals and nursing homes operate on razor thin margins, and many have been losing money for years. Nearly a third of rural hospitals in New York are at immediate risk of closing, according to the Center for Health Care Quality and Payment Reform, a national policy center. Maternity care is particularly vulnerable.
The bulk of House Republicans' planned health care cuts — $625 billion — would come from Medicaid. The remainder would come from changes to the Affordable Care Act, also known as Obamacare, which helps individuals pay for private insurance and also pays for the Essential Plan, New York's free program for people with somewhat higher incomes than Medicaid allows.
Governor Kathy Hochul has said the proposed cuts could lead to 1.5 million New Yorkers losing health insurance in the next 10 years, and would cost the state $13.5 billion annually in lost federal revenue. 'No one state can backfill these massive cuts,' she said in a news release last week.
Rugge said people of all political stripes have an interest in preserving the Adirondacks' fragile health care system. He leads a nonpartisan group, the Health Care Coalition for the North Country, that has been meeting with local town and county officials and encouraging them to write to their federal representatives, particularly Rep. Elise Stefanik, about the importance of Medicaid to their communities.
Stefanik, who won reelection in November with more than 62 percent of the vote, maintains that the Republican bill would 'strengthen and secure' Medicaid by ensuring that only eligible recipients are enrolled.
Stefanik spokesman Wendell Husebo pointed to research by the Empire Center for Public Policy, a conservative think tank, suggesting that many people lie about their income to meet the eligibility requirements for Medicaid and that there has been a surge in the number of undocumented immigrants approved for emergency care.
NOT AN HONOR SYSTEM
Kevin McAvey, managing director of Manatt, a healthcare consulting firm, pushed back at the notion that ineligible people are flooding the Medicaid rolls.
'This is not an honor system,' McAvey said. 'Individuals seeking Medicaid coverage in New York predominantly apply through the state-based marketplace, where their income attestations are checked against federal and state data sources. If such checks cannot be completed, individuals must present documentation that proves their income.'
As for the undocumented immigrants receiving emergency room care — as required by federal law — he said the payments help keep hospitals afloat. 'Emergency Medicaid reimbursements in New York state and across the country protect our health care providers,' he said.
The bill, narrowly passed by Republicans in the House last Thursday, would make a series of technical changes to how the federal government reimburses states for health care costs. It would impose a penalty on states like New York that use state money to offer care to some undocumented immigrants. (Federal law requires hospitals to offer emergency care to everyone, including undocumented immigrants. New York uses its own funds to provide non-emergency care to undocumented pregnant women and people over 65.)
Most significantly, the Republican bill would require working-age Medicaid recipients without children or disabilities to provide documentation each month that shows they have worked at least 80 hours — a requirement that proponents say will prevent abuse and that Medicaid advocates say would add red tape and burdensome administrative costs.
NURSING HOMES
One of the bill's technical changes could have an immediate impact on the state's hospitals and nursing homes: The Centers for Medicare & Medicaid Services this month rolled back its approval of an obscure mechanism, called an MCO tax, that New York had planned to use to draw down an additional $2 billion this year in federal funds. The state was counting on that money to increase Medicaid payments to hospitals and nursing homes.
Heidi Schempp, the administrator of the Elderwood nursing home in the hamlet of North Creek, has been hoping for more state money to help keep her skilled nursing facility afloat. The cost of food and salaries is going up, she said, and reimbursements haven't kept pace.
Seventy percent of her patients rely on Medicaid, and the rates set by the state cover less than 70 percent of the cost of care, she said. She can make up some of the difference by offering short-term rehabilitation services to other patients, which are reimbursed at a higher rate, but it's a struggle. 'My goal is to break even,' she said.
Elderwood has about 70 residents, mostly elderly, and a staff of about 100. Most of the residents worked and paid taxes for decades and qualified for Medicaid only because they've spent their life savings, she said. Medicare, the federal health care plan for people over 65, does not cover the cost of long-term care, so residents typically pay out-of-pocket until their savings are depleted. Elderwood charges about $11,000 a month.
The nearest nursing homes are in Glens Falls, a 45-minute drive south, and Tupper Lake, more than an hour north.
'Can you imagine not being able to see your spouse because they had to move into a nursing home far away?' Schempp said. 'It's just devastating.'
'I'D BE OUT ON THE STREETS'
In a bid to ensure Elderwood's survival, Daniel Way, a retired family doctor and photographer, photographed nursing home residents and interviewed them about their lives, posting their stories online.
'If I didn't have Medicaid I'd be out on the streets,' said one resident, 77-year-old JoAnn King. 'I worked a long time, never been in trouble, loved my country all my life. To the politicians threatening to cut Medicaid, shame on yourselves!'
Planned Parenthood of the North Country operates seven clinics that serve a vast region stretching 165 miles along two-lane roads, from Plattsburgh on Lake Champlain to Watertown near Lake Ontario. Patients may drive an hour or more to reach a clinic, and nearly half rely on Medicaid.
CEO Crystal Collette said Planned Parenthood is the only health care provider for about one-third of their patients, most of whom are young. They rely on Planned Parenthood not only for birth control and abortions, but also to check their blood pressure, screen for cancer, test for sexually transmitted diseases, and treat urinary tract infections.
ON THE BRINK
Recruiting doctors and nurses to work in rural areas is challenging, Collette said, and Planned Parenthood pays a premium to retain them. Like Schempp at the Elderwood nursing home, Collette said the costs of care 'far outpace' Medicaid reimbursements. Private fundraising helps make up the difference.
'We already have a health care system that's teetering on the brink of collapse,' she said. 'Sweeping cuts to Medicaid is something that I don't think we can fundraise our way out of. There's no possible way for our donors to make up the difference.'
The Hyde Amendment has long banned the use of federal funds for abortion, except in cases that endanger the life of the mother or that result from rape or incest. The House bill would go much further; it would cancel all federal funding for Planned Parenthood — including for the routine health care that the organization offers. Although abortions make up only about 3 percent of the services Planned Parenthood provides, the organization has become a lightning rod for anti-abortion groups.
The House bill now goes to the Senate for debate, and revisions are expected. The proposal to ban funding for Planned Parenthood may not pass the Senate, where several Republican senators have voiced their support for the organization.
WORK REQUIREMENTS
Nonetheless, pushing able-bodied people who cannot regularly document their work hours off the Medicaid rolls — as the House bill proposes — would also hurt Planned Parenthood financially. With many North Country residents working part-time jobs with irregular hours, self-employed as carpenters or handymen, or working off-the-books at jobs such as housecleaning, that documentation may be hard to provide, Medicaid advocates say. Without payments from Medicaid, Planned Parenthood would be faced with many more patients who have no ability to pay.
Work requirements overload Medicaid recipients with paperwork that they may not be able to complete even if they are eligible, McAvey said. 'What winds up happening is that eligible recipients end up losing coverage,' he said, citing the experience of Arkansas and Georgia. When Arkansas imposed work requirements, 18,000 people lost health insurance and there was no increase in employment; a judge ordered the state to abandon the plan. In Georgia, the administrative costs of verifying employment far outstrip the cost of health care.
'This debate over a work requirement goes back to ideological differences in views about Medicaid,' said Larry Levitt, executive vice president for health policy at KFF, the national health policy group. 'Some people view Medicaid as a welfare program that should only be for the 'deserving poor' and others view Medicaid as a stepping stone towards universal coverage and that access to healthcare should be a right irrespective of work.'
As the details about the House plan trickle out, state and county legislators are coming to grips with the implications for their own budgets. In New York, the cost of Medicaid is split three ways, with the federal government, the state and the counties each taking a share. If federal funds decline, the state and the counties must either pick up the slack or make cuts, often by reducing reimbursements to providers or eliminating services that are not required by federal law, such as home care for the elderly or routine care for undocumented immigrants.
The state budget passed earlier this month didn't take into account likely federal budget cuts, but the state legislature gave Hochul the authority to institute midyear cuts if necessary.
'It is going to be very difficult to figure out how to fill that gap,' said state Assemblyman Scott Gray of Watertown, a Republican.
After meeting with Rugge and other members of the Health Care Coalition for the North Country, Assemblyman Matt Simpson, of Lake George, said he understands the importance of Medicaid to his constituents. 'I look forward to working together on this and other areas of access to health care throughout our shared community,' said Simpson, a Republican.
The Health Care Coalition for the North County has also met with town and county officials. Schempp said she met with the Town Board in the mostly conservative town where she lives, Indian Lake, and they agreed to pass a resolution calling on Stefanik and other elected officials to 'exercise caution' when considering budget cuts.
Similar resolutions have been passed by the towns of Kingsbury and Schroon Lake, as well as several county boards of supervisors, Rugge said.
After meeting with Rugge's group, Essex County manager Mike Mascarenas told his board of supervisors that significant Medicaid cuts would not only hurt 'the population that receives Medicaid, but to those who pay for it.' If counties need to contribute more to Medicaid, they may need to raise property taxes.
'I've been here 25 years, and what I will tell you with certainty is that the (proposed) change to Medicaid is probably the single biggest threat to property tax that I've ever witnessed in Essex County,' he said. Essex County is a swing county, sometimes voting for Republicans, sometimes for Democrats.
Rugge is optimistic that his work educating his neighbors about Medicaid is bearing fruit. 'We're making a dent,' he said.