Democrats warn: Obamacare repeal will hurt rural hospitals

Constraining the growth of Medicaid spending and reducing federal support for expanded coverage will disproportionately hurt rural communities, according to a new study.

The House bill to replace Obamacare would do both, according to a report released Wednesday by the Democrats on the congressional Joint Economic Committee and U.S. Senate Special Committee on Aging.

Rural residents are less likely to have commercial insurance and more likely to be low income than people who live in metropolitan areas, the report said. Additionally, 24% of people under 65 in rural areas are covered by Medicaid.

That means rural hospitals are particularly vulnerable to cutbacks in the government insurance for the poor and disabled. The report said that 1 in 7 rural hospitals receives more than 20% of its net revenue from Medicaid and disproportionate-share hospital funds.

"A reduction in this funding is a direct threat to care, jobs and economic sustainability of rural communities," the report said.

About a quarter of Medicare recipients in rural areas have health costs that are about $4,000 more a year than a typical Medicare recipient, the Congressional Budget Office reported.

The report from the minority party members of the JEC and Special Committee on Aging referred to the House bill to replace Obamacare, which would no longer guarantee a federal match to state spending in Medicaid. Instead, the federal contribution would grow either at the medical inflation rate for adults and children without disabilities, or at the medical-Consumer Price Index plus 1 percentage point for the aged and disabled.

The Senate, which is writing a bill without input from Democrats, is considering a lower rate of growth than the House bill.

Sen. Pat Toomey (R-Pa.) has argued that the federal contribution should grow at the standard inflation rate, not the higher medical component of consumer spending.

The other Pennsylvania senator, Democrat Bob Casey, says any move to restrain federal spending on Medicaid is an attack on rural communities. Casey, a ranking member on the Special Committee on Aging, jointly issued the report with Sen. Martin Heinrich, ranking member of the Joint Economic Committee.

"First, it rips healthcare protections away from millions," Casey said. "Then, it threatens healthcare jobs in hundreds of hospitals and clinics by eliminating vital funding. I will not sit by idly as Republicans attempt to undermine healthcare protections simply to offer tax breaks to the most elite among us."

Democratic senators, trying to draw attention to the fact that the Senate will soon vote on its own version of an Obamacare replacement, stopped committee meetings Tuesday to protest the secrecy of the bill's crafting. Majority Leader Mitch McConnell said a "discussion draft" of the Senate bill will be released Thursday.