The Newest Welfare Reform From Team Biden: Medicaid Pays For Lodging, Food, And Even Furnishings

The medicalization of daily life through Medicaid coverage of “health-related social needs” is the newest battleground in the Biden administration’s fight to circumvent congressional funding procedures and enlarge the welfare state.

The recent approval of three sections 1115 demonstration initiatives by the Centers for Medicare and Medicaid Services (CMS) permits Oregon, Massachusetts, and Arizona to use Medicaid funds to cover non-medical costs like housing supports (rent, moving costs, furniture), meals, air conditioning, and air purifiers “during climate emergencies,” and transportation services.

These steps are necessary, according to CMS Administrator Chiquita Brooks-LaSure, “to address the core social causes of health difficulties, like lack of access to nourishing food and housing insecurity.”

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This is an unnecessary and possibly huge extension of Medicaid, which is a government-funded health program for low-income families, kids, and people with disabilities, as well as low-income adults in states that have expanded Medicaid. Roughly one in four Americans are covered by Medicaid. It is partially funded by the federal government (on average around two-thirds) and partially by the various states. States have flexibility in how they spend their share, but there are stringent restrictions on how they can utilize the federal piece.

Adding non-medical services to the program might have been viewed as fraud, waste, and abuse prior to these latest authorizations. However, section 1115 waivers enable state Medicaid programs to develop demonstration initiatives that utilize the Children’s Health Insurance Program and Medicaid funding in ways that would otherwise be prohibited by federal regulations.

Of all, there is no rational point at which Medicaid funds should stop being utilized for shelter and food. There may be a connection between the health and happiness of Medicaid participants and items like clothing, gasoline, heating oil, phones, and computers.

The Newest Welfare Reform From Team Biden
The Newest Welfare Reform From Team Biden

Additionally, because states only cover around one-third of the cost, they have a strong incentive to include all kinds of goods and services, especially those that were previously exclusively available through state funding, under the Medicaid program. Expect a flood of waiver requests covering an ever-growing list of “social demands” relating to health.

Budget-neutral waivers under Section 1115 are those that do not increase government spending beyond what it would have been in the absence of the waiver. However, as the Government Accountability Office has emphasized, CMS budget-neutrality findings are loose, “lack transparency,” and frequently raise the financial obligation of the federal government. Additionally, newer, more accommodating CMS standards permit the use of alleged savings from earlier waiver cycles to reduce the cost of new waivers.

Also being developed by the Centers for Medicare and Medicaid Services are Medicare Advantage models that will include services like meal delivery and rental assistance.

In fact, since 2003, Medicaid has been on the GAO’s “list of high-risk programs,” in part because of worries about insufficient financial monitoring, particularly oversight of section 1115 demonstrations.

Medicaid is just the beginning for Team Biden. The 3.7 million “underserved” MA enrollees will receive supplemental benefits like nonmedical transportation, meal delivery, and rental assistance as part of the development of Medicare Advantage models that address the social determinants of health, according to the Center for Medicare and Medicaid Innovation at CMS.

For beneficiaries of Medicare and Medicaid, a Health-Related Social Needs Screening Tool is also being tested. Without a hint of irony, the organization asserts that physicians may “simply” use the 26-question, eight-page questionnaire “as part of their busy clinical workflows with people of all different ages, backgrounds, and locations” to “inform patients’ treatment plans and provide referrals to community agencies.”

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The administration’s other efforts to enlarge the welfare state are consistent with expanding the concept of government-funded health care. President Joe Biden recognized that the public health emergency that prevents states from eliminating an estimated 16 million ineligible users from the Medicaid rolls has been repeatedly prolonged. These beneficiaries can now anticipate receiving non-medical compensation as well.

The reason Medicaid is covering things like housing, food, air conditioning, and other non-medical services should be questioned by the taxpaying public. These issues are already covered by other public welfare programs with significant federal funding sources, and the majority of Medicaid participants already benefit from these initiatives.

Additionally, Congress should inquire as to why the administration is unilaterally modifying a medical assistance program to pay for non-medical services that Congress has already approved funding for. Medicaid expansion to include social needs relating to health is a horrible policy, and Congress, not executive-branch bureaucrats, should decide whether to implement it.

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