Former Grains Council Chairman: Government Health Insurance Systems Would Harm Rural Iowans

WASHINGTON – As Democratic 2020 hopefuls prepare to take the presidential debate stage this week, headlines continue to highlight the threats associated with calls for new government-controlled health insurance systems like the public option, Medicare buy-in and Medicare for all.  In new op-ed for the Des Moines Register, Julius Schaaf, an Iowa farmer and former U.S. Grains Council Chairman, warns against the unaffordable costs and risks Iowa families would face under these one-size-fits-all systems.  He writes:

… Now, more than ever, farmers and ranchers have two major concerns related to health care: cost and access …  According to a new Navigant study, offering a government insurance program reimbursing at Medicare rates as a public option on the health insurance exchanges created by the Affordable Care Act (ACA) could place as many as 55% of rural hospitals, or 1,037 hospitals across 46 states, at high risk of closure across the country.  Here in Iowa, a public option could put 58% of our rural hospitals at high risk of closure, according to the study. 
 
The rural communities that are lucky enough to keep their hospitals will likely suffer decreased access to care as hospitals will likely be forced to cut costs by reducing services in order to remain open.  Already, we’re seeing a troubling trend of rural and small community hospitals closing departments, eliminating staff and taking other measures so they remain financially stable.  According to the Iowa Rural Health Association, in 1973, 140 hospitals provided maternity services in Iowa.  In 2018, that figure has dropped to 70 hospitals — with two dozen closures in the past 15 years.  Seven of those closures occurred in 2018 alone.  Given the massive reimbursement cuts to hospitals projected, our state has little chance of reversing this trend in the future should “Medicare for All,” buy-in or public option become law.
 
… The high costs of “Medicare for all” would impact working rural families’ budgets as well. Independent analyses conducted by both the Urban Institute and the Mercatus Center at George Mason University estimate that should a Medicare buy-in or public option program ultimately lead to “Medicare for all,” it would cost taxpayers approximately $32 trillion over 10 years … The last thing our farm families need now is a huge tax increase.
 
As consideration of “Medicare for all,” Medicare buy-in and public option continue to dominate the Democratic presidential debates, Iowa’s ag families can’t afford to be ignored.  Any way you look at it, the potential costs to our rural communities far outweigh the sweeping promises being made on the campaign trail.

Earlier this month, in a story headlined “52 Rural Iowa Hospitals At Risk Of Closing Under Public Option, Analysis Shows,” The Gazette (Cedar Rapids) warned about the damage the public option could inflict on vulnerable rural hospitals:

Iowa’s rural hospitals could experience a loss of more than $476 million dollars under a public health insurance proposal, putting dozens at high risk for closure, according to an analysis.  Iowa’s rural health care facilities long have faced challenges due to Medicare reimbursement rates.  But the analysis said those hospitals could be confronted with an even bigger detriment if a public option is implemented using Medicare reimbursement rates … Chicago-based data company Navigant released an analysis this past month that studies the impact of a public option, a proposal to create a government-run insurance plan to compete with private insurance companies.  It’s also a pitch that’s become common — in various iterations — among Democratic candidates running for president … If a public option plan would go into effect, the study found that between 25 and 52 of Iowa’s 90 rural hospitals would be at high financial risk for closure due to a loss of millions in revenue.

The study, conducted by Navigant, finds that the public option could put more than 1,000 rural U.S. hospitals in 46 states “at high risk of closure.”  These hospitals serve more than 60 million Americans, and as Kaiser Health News and NPR report, hospital closures can have “profound social, emotional and medical consequences.”  As RevCycleIntelligence also reports, “[p]atient access to care suffers when a rural hospital closes its doors for good, and consequently, patient outcomes can deteriorate.”