House Republican Budget Cuts Would Have a Devastating Impact on Iowa’s Seniors and Children

Iowa to Lose $15.1 Billion in Federal Medicaid, Medicare, and Other Health Coverage Funding

Washington, D.C.—The budget introduced this week by Republicans in the U.S. House of Representatives slashes $15.1 billion in federal funding for Medicaid, Medicare, and other health coverage programs in Iowa over the next 10 years, with $8.4 billion cut from Medicaid alone, according to an analysis released today by the consumer health group Families USA.

These cutbacks will have a disproportionate impact on Iowa’s seniors. The Medicaid program is the largest payer of long-term care, including half of all nursing home costs. Medicare provides health coverage for seniors over 65 years of age.

The Medicaid cuts will also have an adverse impact on Iowa’s children. There are 225,000 low-income children in the state who depend on Medicaid for their health care.

“The proposed House Republican health care cuts will have a devastating impact on Iowa’s seniors and children,” said Ron Pollack, Families USA’s Executive Director. “They will keep frail seniors from getting needed nursing home and long-term care, and they will cause many children to lose their access to health care.”

Medicaid cuts in Iowa result from two major changes in the House Republican budget: (1) converting the current program into a block grant with severe cuts of $6.2 billion to federal funds provided to the state; and (2) eliminating the program’s scheduled coverage expansion to the uninsured under the Affordable Care Act (a cut of $2.2 billion).  

The House Republican budget also substantially increases income taxes for middle-income families. It does so by eliminating tax credits, scheduled to go into effect in 2014, designed to help middle-class families pay for health insurance. For example, a family of four with about $45,000 in annual income and monthly health insurance premiums of $1,100 would lose an annual tax credit of nearly $10,400.

Among the findings in the Families USA report applicable to Iowa are the following:

• There are 42,500 seniors in Iowa who rely on Medicaid to pay for services Medicare does not cover, like long-term care—and these are the people most vulnerable to the House Republicans’ Medicaid cuts.

• In 2021 alone, the state’s block grant Medicaid cuts could provide health coverage for 460,400 low-income children in Iowa.

• Also in 2021, the state’s block grant Medicaid cuts in that year alone could provide health coverage for 54,900 seniors in Iowa.

• The House Republican budget strips away new coverage options and subsidies that would reduce the number of uninsured in Iowa by 220,000 in 2021.

The Families USA analysis does not include the huge Medicare cuts that become effective in 2022—cuts that are derived by transforming the program to a privatized voucher program.

“At the same time that House Republicans are extending huge tax cuts for America’s richest people,” said Pollack, “they are cutting back needed health care for Iowa’s seniors and low-income children and raising taxes on the middle class. This makes no sense and reflects cruel and misplaced ideological priorities.”

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Families USA is the national organization for health care consumers. It is nonprofit and nonpartisan and advocates for high-quality, affordable health care for all Americans.

1201 New York Avenue NW, Suite 1100 · Washington, DC 20005
202-628-3030 · Email: info@familiesusa.org · www.familiesusa.org