Seema Verma, the administrator for the Centers for Medicare & Medicaid Services, sat down for a rare interview with KHN senior correspondent Sarah Varney. They discuss her views on President Donald Trump’s plan for sustaining public health insurance programs, how the administration would respond if Obamacare is struck down by the courts in the future,and her thoughts on how the latest "Medicare for All" proposals would affect innovation and access to care.
A portion of their conversation aired on PBS NewsHour on Dec. 23. A transcript follows, edited for length and clarity:
Sarah Varney: Thank you, Administrator Verma, for joining us. We really appreciate it. You spoke recently about this need to protect Medicaid as a lifeline, but also not to have people be entrapped, or trapped on, Medicaid and come to rely upon it too greatly. So, as I was mentioning, we were in Tennessee recently, and I know you can’t speak to specific cases —
Seema Verma: Mmm, hmm.
Varney: But, we did find a number of families who had been disenrolled, and then found it quite difficult to get back on. And I just wondered if there is a danger in taking this approach where there’s more frequent verification checks, a real focus on eligibility verification, that it could discourage some parents and kids who might be eligible for the program from signing up?
Verma: Well, our top priority is making sure that the beneficiaries in the Medicaid program have high-quality, accessible care, and we want to do everything that we can to improve the quality of their lives. In terms of the enrollment process, we also have an obligation to taxpayers to make sure that only the people that qualify for the programs are participating. And we also want to make sure that the programs are sustainable over the long term. I think there’s a balance between making sure it’s easy for people to apply, but we also have to make sure that we do the appropriate work to make sure that they qualify for the programs.
Varney: So, are you concerned, though, that there were a number of people, after the eligibility process kicked in again in 2017, after the ACA sort of put things on hold for a while, that there might have been families, though, that have been lost? That just don’t want to come back, or can’t come back? Or are hearing worries about the public charge rule, as well, and so are concerned about giving the government their information?
Verma: You know, our top priority is making sure that we focus on improving quality of care, high-quality care, accessible care, and making sure that we’re improving the quality of life for individuals. You know, when I think of the Medicaid program, and in every decision we make, I try to keep in mind the actual beneficiary. In my time spent on the Medicaid program, I’ve met a lot of Medicaid beneficiaries. I met a gentleman, Richard, who was in Indiana. He was a quadriplegic and literally requires 24-hour care. I met some parents of a child on the Medicaid program. This child had cerebral palsy and so severe that they require 24-hour care, and you can imagine the impact on the entire family. This is a child that will never be independent, will always require help. And so, when we’re creating our eligibility policies, we keep those individuals in mind. We don’t want to make it harder for them to apply for the program.
And so, we try to come up with policies that don’t put a lot of onerous requirements on the beneficiary, but we can have requirements for states that require them to do back-end processes, and back-end checks that don’t actually burden the actual recipient or their families, but that also ensure that we are putting the appropriate protections in place for taxpayers, so the program is sustainable over the long term. And we have only the people that qualify for the program participating.
Varney: We know that more health coverage leads to longer life expectancy; I think this has been well established. And I wonder if whether or not the administration should be emphasizing more finding those children who are not enrolled, who are eligible but not enrolled, and perhaps focusing on outreach, which we haven’t really heard your administration talk about?
Verma: Well, again. Our focus is on making sure, especially children, that they have access to high-quality health care. As a mom, I’ve got two kids, so I can personally attest to the fact that having health insurance is very important for children. Something very little, like an ear infection, can lead to deafness if it’s not, you know, treated appropriately. So having that access to high-quality health care is very, very important to their development. The Trump administration is very committed to the Children’s Health Insurance Program; the president signed legislation around that. Additionally, we have spent over $48 million on outreach efforts. We’re very focused on working with states, so that they can identify the best practices to make sure that those individuals, children that qualify, can enroll in the program, that they’re aware that this program exists.
Varney: Have you found that the reduction in the Navigator grants has made it more difficult to reach those families?
Verma: We, actually, we have not. If you look, the Navigator programs are really aimed at the Affordable Care Act programs and the exchange programs. So those are not aimed at children. Those are aimed at our adult population. And we have seen very minimal impact. What we have done is try to increase our digital communication, of, to help enrollment. And we’ve seen a very minimal impact on enrollment.
I think the issue around enrollment really comes back to affordability. Obamacare has had a direct impact on increasing premiums. Across the nation, we’ve seen premiums go up by 100 percent, 200 percent. [Editor’s note: PolitiFact rated this claim by the Trump administration “false.” ACA premiums were down by about 4 percent in 2019 compared with 2018.] And so the issue around enrollment is that health insurance has become so unaffordable for families that that’s why they can’t afford their coverage.
Varney: So we did hear from a number of federally qualified health centers that although the Navigator grants really were focused on, you know, ideally they were focused on exchanges, people buying private health insurance, that, in fact, there were a lot of people who came in, who became eligible for Medicaid and discovered that they were eligible for Medicaid in that way. So I wonder if there is additional outreach that needs to be done to those families, not just virtually or online, but some other way to reach those families?
Verma: The real problem around making sure that people have access to affordable coverage is really addressing the high cost of health care. And that’s what the president is focused on. His health care agenda isn’t just about putting out more subsidies and having the government pay more and more and creating unaffordable programs. But it is about addressing the underlying cost drivers in health care. That’s why he’s focused on prescription drug pricing, he’s focused on transparency, price transparency, so that there’s more competition in the market. We’re also focused on getting rid of burdensome regulations that we know drive up the cost of care.
I think by addressing that, that is going to result in decreased premiums, which will result in more people having access to affordable coverage.
Varney: But all those things that you just mentioned—they don’t necessarily affect the Medicaid population directly. Now, they may affect them indirectly by increasing overall health care costs, but in terms of the Medicaid population, really reaching out, ensuring that every single child who’s eligible for Medicaid is enrolled?
Verma: So, our focus is also on addressing the economy. Under the president’s leadership, we have a booming economy. We have one of the lowest unemployment rates. We have more people that are earning more money, and we have fewer people living in poverty. There’s been a reduction in the number of people living in poverty by 1.4 million people. And so, we are seeing people coming out of the Medicaid program, and because the economy’s doing so well. The issue is, though, they can’t afford coverage. And so, even as we increase our outreach efforts, we spent over $48 million on outreach, the issue is around affordability. Obamacare has impacted the market in such a way that it’s become unaffordable for people that don’t have subsidies.
Varney: So, we’re at this moment in our country and our national conversation where we’re talking about how do we ensure that more and more people are insured? And I wonder what the administration is doing to move the needle, to stop the growth in the uninsured, particularly among children?
Verma: I think our focus has been about addressing affordability of health care. The underlying issue in people not being able to afford their health insurance is that it’s too expensive. And the solution is not trying to throw more government money around subsidies, because that’s just going to increase taxes for everybody. Our approach is to address the underlying issues. President Trump is addressing long-standing issues in health care that haven’t been addressed by any administration. The blueprint that he put out on drug pricing was very historic. The work that he’s done on price transparency. And the work that we’re trying to do around the regulatory burden, getting rid of all kinds of unnecessary regulations that are actually increasing the cost of health care for providers. We spend over $200 billion on administrative costs every year. So what we’re trying to do is address the cost of health care, but also make sure that we continue to have the high-quality, innovative health care system that Americans are used to.
Varney: So there are some people who are advocating for a Medicare for All type of solution to this, to say that much of those costs are because the marketplace, in a sense, doesn’t work in health care. And I wonder what you say to people who are proposing that? Who are saying, this is all just, that the market doesn’t work when it comes to health care?
Verma: So, when it comes to health care and it comes to the solutions around Medicare for All. … Medicare for All would strip Americans, 180 million Americans, of their private health insurance and put them on a government-run, bureaucratic program. If we look at the programs that we have today, our government-run programs, our Medicare program is not affordable. The Medicare Trustees have indicated in the next seven years they’re gonna run out of money, they’re gonna have trouble paying their bills. The Medicaid program is the No. 1, No. 2 budget item for many states. And you’re hearing states every day—look at the situation in New York, where they can’t afford their Medicaid programs. And so, our track record on government-run programs isn’t strong. And I think our focus is on trying to unleash competition to drive down costs, but keep the innovation in the system. Our concern is that a government-run or more government is going to thwart innovation.
As the head of the Medicare program, I see every day that government regulations kind of stand in the way, that there are delays in our beneficiaries being able to access treatments. That’s why the president put out the Medicare Executive Order, which was focused on making sure we can do better with this. But I think, you know, putting more people on a government program is actually going to threaten the sustainability of the programs that we have in place today.
Varney: And do you think through the measures that you’re talking about, that you could reduce costs—15 percent, 20 percent—in the health care system of the United States?
Verma: I think our goal is to try to reduce cost, and to make it more unaffordable [sic]. And we’ve had great success with this under President Trump’s leadership. If we look at the Medicare Advantage Program, for example, under his leadership, premiums have gone down by over 23 percent since he came into office. In the Part D program, premiums are down by 13 percent, the lowest level in seven years. Going back to Medicare Advantage, that’s the lowest level in 13 years. So, I think the president’s policies are working, because we demonstrated that we can lower premiums.
Same thing on the individual exchanges. For the very first time, the individual market has been stabilized and premiums went down last year by a percent, this year by 4 percent, and they’re still too high, there’s a new class of uninsured being created by Obamacare, but President Trump’s policies have actually resulted in more Americans, more seniors having money back in their pockets.
Varney: Now we’re waiting for a ruling from the courts on the future of the Affordable Care Act. If it’s struck down, what is your plan to replace it?
Verma: Well, the president’s been very clear that he wants to make sure that individuals with preexisting conditions have protections. And we have prepared for a variety of scenarios, and we want to make sure that there’s no disruption in coverage. And we’ll work with Congress to make sure that Americans have access to high-quality, affordable coverage. That is not what they have today. People with preexisting conditions do not have those protections. Individuals that don’t get subsidies and can’t afford coverage really don’t have those protections. And so the president wants to make sure that we’re addressing those individuals, and that people with preexisting conditions have the appropriate protections that they don’t have today.
Varney: But how do you guarantee those protections, also reduce costs and not lead to widespread uninsurance rates going up?
Verma: I think our focus is not just on costs, but it’s also making sure that we preserve quality and innovation in the system. One of the initiatives that we’ve had is around trying to pay our providers differently. Right now, we’re paying in a system where we just pay for people to get things done. And we want to change that paradigm, where we’re holding providers accountable for providing quality care, improving the quality of life, preventing disease and keeping people healthy.
Varney: So, just my final question. There have been these reports of a rift, a growing rift between you and Department of Health & Human Services Secretary Alex Azar. And I wonder if people should be concerned about whether or not that’s going to get in the way of the very ambitious slate of initiatives that you and President Trump have planned?
Verma: Well, Secretary Azar and I are both committed and have a shared goal around delivering on the president’s agenda.
Kaiser Health News is a nonprofit news service covering health issues. It is an editorially independent program of the Kaiser Family Foundation, which is not affiliated with Kaiser Permanente.