Medicaid cuts could weaken services for those with Down syndrome

Across the nation, scores of celebrations took place in honor of World Down Syndrome Day over the weekend, with events touting the value of inclusion and support.

But advocates for individuals with Down syndrome say they’re gravely worried about pending cuts to Medicaid and their impact on programs that support individuals with Down syndrome and other developmental disabilities. President Trump and Congress approved the H.R. 1 tax package (often called the One Big Beautiful Bill) last summer. The package is projected to reduce Medicaid spending by nearly $1 trillion over the next decade.

Heather Sachs, policy and advocacy co-director of the National Down Syndrome Congress, tells Chief Healthcare Executive® that the impact of the legislation is “really bad for people with disabilities.”

“States are already making budgetary changes, making changes to their Medicaid systems in anticipation of these many changes, and this is having significant ripple effects down to the families and people with disabilities,” Sachs says.

Over the coming years, states will face new restrictions on how they finance their Medicaid programs, and Sachs and other analysts say they will have to scale back services.

Kim Musheno, senior director of Medicaid policy for The Arc of the United States, tells Chief Healthcare Executive that families are dreading the prospect of reduced support for services for those with Down syndrome.

“Medicaid is not optional for people with Down syndrome,” Musheno says. “It's essential. Medicaid covers not just health care, but it covers services across the lifespan. Medicaid helps to pay for early interventions and ongoing therapies and home and community-based services.”

‘Services being cut’

State Medicaid programs must provide certain services for individuals with developmental disabilities to qualify for federal funding, including coverage for health care. For individuals with Down syndrome, Medicaid programs cover the costs of doctors’ appointments, prescriptions, and durable medical equipment. Support for such services won’t be affected by cuts to Medicaid programs, Sachs says.

But other Medicaid services, often called “waiver services,” are optional for states, and they include home and community-based services.

“Those are really the key services for people with disabilities to be able to live and thrive in the community,” Sachs says. “Medicaid isn't just health insurance. It's really the infrastructure for people's daily life.”

Those home- and community-based services are “the first things that are being cut,” Sachs says.

“We're already seeing these services being cut,” she says. “These are the services, for example, that provide folks with access to job coaching, personal care assistance, helping them get dressed, get ready for work in their own homes, rather than in an institutional setting. And so we're really feeling the impact of that now, and it's going to continue to get even worse as HR 1 comes online.”

“A lot of people, particularly outside the disability community, just think of Medicaid as sort of a health insurance, but it is everything for people with Down syndrome and disabilities to be able to live in the community and not in institutional settings, and that comes through home and community-based services … and that's what's being threatened right now,” Sachs says.

Idaho has proposed cuts to community-based services, but Sachs says other states such as Maryland are weighing the possibility of scaling back Medicaid services as they expect less support in the coming years.

Barbara Merrill, vice president of public policy for ANCOR, represents more than 2,500 organizations offering home and community-based services.

At a House Education and Commerce Committee hearing on the rising costs of health care last week, Merrill testified that home and community-based services tend to be far less expensive than housing individuals in institutions. She said that community-based services through Medicaid cost on average, $70,000 annually per person, while supporting individuals in state-run institutions costs $395,000 a year.

“The best way to help to lower healthcare costs and improve outcomes for people with disabilities is to strengthen home and community-based services,” Merrill said.

Targeting abuse, and collateral damage

The Centers for Medicare & Medicaid Services has also warned that it is cracking down on waste and fraud in Medicaid programs, including those supporting community-based services.

The agency has withheld nearly $250 million in funding to Minnesota Medicaid programs, saying the state hasn’t complied with federal rules to prevent abuse. Minnesota Public Radio reported last week that the CMS has approved a corrective action plan submitted by the state, which could lead to the release of funds.

Advocates for those with intellectual disabilities say they understand the need to ensure funds are used properly, but they warn that the action in Minnesota has hurt other good programs that serve those who need assistance.

“While everybody supports getting rid of waste, fraud and abuse, the data shows that Medicaid fraud is relatively rare, especially compared to the size of the program,” Musheno says. “And these policies that they're instigating now, they don't just target bad actors. They create barriers for eligible people.”

Organizations representing those with Down syndrome fear that good programs will be damaged, with families paying the price.

Referring to Minnesota, Sachs says, “There absolutely is some fraud going on. Nobody doubts that. We want them to get to the bottom of it, but they're withholding entire categories of funds. And this is really a shift from previous administrations.”

Dr. Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services, says that the agency is looking at how states are using Medicaid funds in autism programs and other areas. He released a recent video saying the agency has reached out to officials in Maine and said CMS will work with the state to get their house in order.

“If we’re not satisfied with their progress, we reserve the right to cut off payments entirely,” Oz said.

During an appearance at the HIMSS Global Health Conference & Exhibition earlier this month, Oz mentioned plans to ensure money for autism programs is used appropriately, and called the lack of accountability a big problem.

“It's not just a few bad apples doing bad things,” Oz said. “How do you know if the tools you're giving the American people work? If we're trying to give kids with autism access to care, is it the right service? Does it work? How much should they get?”

Sachs says actions to cut off funds broadly to states can do lasting damage.

“Federal funding is really being used as leverage in this case, and again, it has ripple effects down on the actual individuals and families that use the system,” Sachs says. “Because, good programs are shutting down, becoming collateral damage. Providers are having to fire staff, and there's already a massive shortage in direct support professionals, and so this is really exacerbating it as well.”

Advocates also say that they fear casting efforts to go after waste and fraud are more successful, and easier to support, than simply cutting services and funding for programs to aid those with disabilities.

“It's extremely alarming,” Musheno says.

“When you make this amount of cuts, it's going to hurt everyone,” Musheno says, adding, “They're using waste, fraud and abuse, because that's a narrative that works with the public.”

Testifying at the House hearing last week, Merrill urged lawmakers to ensure efforts to prevent waste and fraud are “precise and targeted.”

“Cutting off funding from all providers of a given service serves to threaten the most vulnerable people and their families, and runs counter to the goal of saving taxpayer dollars,” she said.

Pressure on Medicaid programs

Medicaid also offers aid to public schools to support those with Down syndrome and other disabilities, and those services could be at risk as states scale back programs. Public schools get millions of dollars from Medicaid, Sachs says.

“Folks don't realize that there is a direct connection between those massive cuts to Medicaid on the federal level, and schools are going to be getting even less funding,” she says. “And the funding from Medicaid that goes to schools covers things such as therapies … OT, speech therapy, physical therapy, mental health resources, being able to hire more guidance counselors, etc. So schools are impacted by Medicaid.”

New work requirements for Medicaid also take effect beginning Jan. 1, which could affect parents and guardians of those with Down syndrome and other developmental disabilities.

“The parents or caregivers, if they don't meet a certain exemption, are going to have to comply with that. So they're going to have to do a lot more paperwork as well, with the potential of getting kicked off of Medicaid,” Sachs says.

Many direct support professionals also rely on Medicaid, and they’ll have to comply with new requirements to prove their eligibility every six months. And Medicaid programs will have to spend more resources verifying the eligibility of recipients.

“From a systemic level, this is just going to put a huge amount of pressure on these state Medicaid systems, which are already unstable,” Sachs says.