Better Know a District and AHCA’s Impact: The Central Valley

The “American Health Care Act” would not only take away health care for millions of Californians, but also make it harder for people to get and keep health coverage. Californians will pay more and get less coverage and care as a result of this proposal.

Let’s dive into the impacts in just one area, in the heart of the Central Valley: the 21st Congressional District, currently represented by Rep. David Valadao, which will be deeply impacted.

The uninsurance rate fell by 48% under the ACA, from 23%[i] in 2013 to 12%[ii] in 2015.

In this district, 403,736[iii] (56%) are on the Medicaid program, which would be cut by 25% under AHCA, both through the roll-back of the Medicaid expansion and implementation of per capita caps.

An estimated 99,000 of district residents gained coverage through Medicaid expansion and would lose coverage in 2020.

  • In Fresno County, 50% of residents are on Medicaid.[iv]
  • In Kern County, 45% of residents are on Medicaid. [v]
  • In Kings County, 38% of residents are on Medicaid.[vi]
  • In Tulare County, 55% of residents are on Medicaid.[vii]

In 2016, 16,556 of district constituents bought affordable coverage through Covered California, the state’s marketplace. Constituents received a total of over $55 million in federal funding, nearly $47 million in premium tax credits and $8 million in cost-sharing reduction subsidies. [viii]

There were 15,799 (95%)[ix] individuals that received financial assistance to afford coverage, at an annual, average rate of $3,912 for premium tax credits and $700 for cost-sharing reductions.[x]

  • The AHCA would reduce the average tax credit by 40% in 2020 and by 50% in 2026.
  • This would disproportionately impact your older, low-income constituents and those who live in rural and high-cost areas. For example, a 60-year old person earning $17,820 annually (at 150% FPL) currently receives $7,968 annually in premium tax credits through the ACA. This same person would only receive $4,000 annually under the AHCA.

Counties in this district will suffer dramatic economic losses due to job and GDP losses.

  • In Fresno County, 6,000 jobs and $516 million in GDP will be lost.[xi]
  • In Kern County, 5,000 jobs and $359 million in GDP will be lost.[xii]
  • In Kings County, 600 jobs and $44 million in GDP will be lost.[xiii]
  • In Tulare County, 3,000 jobs and $193 million in GDP will be lost.[xiv]

Safety-net providers in this district provide critical services and will be greatly impacted by cuts to Medicaid funding.

  • There are 50 community clinics and health centers in your district that had over 716,000 patient encounters and served 206,000 residents, 62% of which are on Medicaid.[xv]
  • Planned Parenthood has 2 health centers near your district that had 35,000 patient encounters for primary and preventive care.[xvi]

Hospitals in this district rely heavily on Medicaid funding. The CBO estimates the AHCA would cut Medicaid funding by 25%,[xvii] resulting in drastic reductions for hospitals. For example, Adventist Medical Center in Hanford receives over $383 million[xviii] in Medicaid revenue and cuts would amount to around $96 million.

Since Monday, three additional important fiscal analyses were published that provide further impacts of AHCA in the state of California and the district.

First, Covered California, the state’s marketplace, issued a region-by-region analysis comparing financial assistance issued under the Affordable Care Act (ACA) and the American Health Care Act (AHCA). (March 20, 2017)

  • The analysis demonstrates how consumers at different income ranges would be impacted in all 19 Covered California regions.  Covered California analyzed the financial help that consumers would receive in 2020 based on the current ACA subsidies — which consider a consumer’s age, income, family size and where they live, with the proposed age-based-only subsidies of the AHCA.
  • Under AHCA, health insurance premiums would be 15% to 20% higher in 2018 and 2019, than in existing ACA law, and the amount of tax credits under AHCA would only be 60% what is already currently provided with the ACA.
  • This means older Californians, specifically those who are lower income and live in high-cost areas or rural areas where access to care is limited, would face large increases in costs and force them to spend a significant portion of their entire income in order to maintain coverage.
  • In Covered California’s Regions 10 and 14 (including Congressman Valadao’s district like Tulare County and Kern County), folks of all ages making $17,000 or $30,000 would have to pay significantly more for coverage, given the flat tax credit that does not adjust for income or premiums in high-cost areas.
  • Region 10 –
    • Someone in Modesto making $17,000 a year would pay $622 for coverage today—but would pay $3,089 for coverage if they were 27 years old; $3,206 if they were 40 years old, and a whopping $9,952 if they were 62 years old.
    • A worker making $30,000 in Turlock pays $2,494 in premiums today, but would pay $3,089 if she was 27 years old; $3,206 if she was 40 years ago, and $9,952 if she was 62 years old.
  • Region 14 –
    • A person in Kern County, making $17,000 a year would pay $622 for coverage today—but would pay $2,808 for coverage if they were 27 years old; $2,864 if they were 40 years old, and a whopping $9,182 if they were 62 years old.
    • A worker making $30,000 in Bakersfield, pays $2,494 in premiums today, but would pay $2,808 if she was 27 years old; $2,864 if she was 40 years ago, and $9,182 if she was 62 years old.

Second, UC Berkeley’s Labor Center published a policy brief of AHCA cuts to Medicaid (Medi-Cal in the state) expansion funding, entitled, Medi-Cal Expansion under AHCA: Severe Coverage and Funding Loss unless State Backfills Billions in Federal Cuts.  (March 21, 2017) Key highlights of the analysis include:

  • 3.7 million fewer Californians would be enrolled in Medicaid 2027;
  • California’s health care system  would lose $25 billion in Medicaid funding by 2027, $22 billion of which are federal funding;
  • California’s health care system would lose a cumulative of $130 billion in federal and state Medicaid funding between 2020 and 2027.
  • Certain parts of the state would be significantly harmed by federal cuts.
  • In the San Joaquin Valley, where residents have a high rate of enrollment in the Medicaid expansion, over 465,000 residents would lose coverage in 2027 and the local healthcare system would lose more than $3 billion annually by 2027.
  • In Kern County, just due to the Medicaid expansion rollback alone, 95,800 people are projected to lose coverage by 2027, a 9.5% reduction in overall coverage for county—a $645 million cut to the health system. In Tulare County, 55,000 people are projected to lose coverage, for a cut of $371 million. Rural parts of California face similar losses.
  • In Congressman Valadao’s District (21), the Medicaid expansion rollback would mean 93,900 constituents are project to lose coverage—for a cut in Medi-Cal funding of $632 million. 

Lastly, California’s Department of Health Care Services, which administers our state’s Medicaid program, published a summary of fiscal impacts of AHCA on the state’s Medicaid/Medi-Cal program. (March 22, 2017) Most significant concerns with AHCA include:

  • AHCA’s new Medicaid funding methodology (block grant or per capita caps) affects nearly all enrollees and funding, which represents a fundamental change in a 50 year-old federal-state partnership and the creation of Medicaid.
  • With proposed AHCA overall Medicaid funding cuts, it is estimated that California will be responsible for a state share of $680 million in 2020 and $5.3 billion by 2027.
  • With proposed AHCA Medicaid expansion cuts, 4.8 million people will not be eligible for enhanced federal funding, and instead will be a 50-50 state to federal cost-sharing ratio. This will cost $4.8 billion in 2020, and grow to $18.5 billion in 2027.
  • The state’s share would be $3.3 billion in 2020, and grow to $13 billion in 2027.

[i] US Census, American Fact Finder, American Community Survey, Health Insurance Coverage in the U.S. 1-Year Estimates 2013.

[ii] US Census, American Fact Finder, American Community Survey, Health Insurance Coverage in the U.S. 1-Year Estimate 2015.

[iii] UC Berkeley Labor Center, Fact Sheet: Medi-Cal Enrollment by U.S. Congressional District, February 2017.

[iv] California Budget and Policy Center, Fact Sheet: Medi-Cal, November 2016.

[v] Ibid.

[vi] Ibid.

[vii] Ibid.

[viii] Covered California, 2016 Bridging Health Care Coverage Within Reach, March 2017.

[ix] Ibid.

[x] Ibid.

[xi] UC Berkeley Labor Center and UCLA for Health Policy Research, Fact Sheet: What does Fresno County Stand to Lose Under ACA Repeal? January 2017.

[xii] UC Berkeley Labor Center and UCLA for Health Policy Research, Fact Sheet: What does Kern County Stand to Lose Under ACA Repeal? January 2017.

[xiii] UC Berkeley Labor Center and UCLA for Health Policy Research, Fact Sheet: What does Kings County Stand to Lose Under ACA Repeal? January 2017.

[xiv] UC Berkeley Labor Center and UCLA for Health Policy Research, Fact Sheet: What does Tulare County Stand to Lose Under ACA Repeal? January 2017.

[xv] California Health+ Advocates, California Community Clinics and Health Centers, Congressional District 21 Profile, 2017.

[xvi] Planned Parenthood Affiliates of California, Congressional District 21 Profile, 2017.

[xvii] Congressional Budget Office, American Health Care Act Cost Estimate, March 13, 2017.

[xviii] Office of Statewide Health Planning & Development, Hospital Data.

Comments are closed.