THE BLOG

The Fiscal Cliff and Health: A Scary Combination

11/26/2012 10:47 am ET | Updated Jan 26, 2013

New trending topic: the fiscal cliff. Washington loves its metaphors and the fiscal cliff is no exception. Unless Congress and the administration reach a new compromise, come Jan. 2, 2013, discretionary spending, or what most people really consider "government" -- education, transportation and health -- will be slashed by 8.2 percent.

This has dire consequences for the nation's economy. The Congressional Budget Office estimates the economy will shrink and unemployment will rise.

Going over the fiscal cliff will also have a serious impact on public health and access to quality health care for the entire nation now and years to come. The Budget Control Act requires a $1.5 trillion cut in federal programs over the next decade. This comes at a time when low-income Americans continue to ride out a weak economy and rely more than ever on safety net programs to receive health care and food, and while states begin implementing the Affordable Care Act (ACA) to make health insurance coverage more affordable for millions of uninsured Americans.

The consequences of going over the fiscal cliff would be devastating for federal health programs and its efforts to eliminate racial and ethnic health and health care disparities. Groups like Asian Americans, Native Hawaiians and Pacific Islanders (AAs and NHPIs) are disproportionately uninsured and suffer from a number of chronic health conditions, including diabetes, cancer and obesity. Funding cuts could halt important scientific research and public health programs for these and other communities.

While policy makers have renewed talks designed to reach a new "grand bargain," health advocates and public health leaders are worried that a new compromise could also threaten some of the very programs that were excluded from the sequester, such as Medicaid and the Children's Health Insurance Program.

Congressional leaders have already proven they are willing to slash health funding to reach a compromise. The House Republican 2013 budget would have fundamentally altered Medicaid, slashed funding for food stamps and eliminated important public health initiatives. And last year's Simpson-Bowles plan would have also cut funding for health programs as a mechanism to reduce the federal deficit.

Funding cuts would come at a time when health reform implementation is proceeding at warp speed in many states, with major deadlines approaching. A number of governors have already agreed to participate in the law's Medicaid expansion, while others have declined and even more are on the fence. Any cuts to Medicaid or attempts to alter the program's funding structure could provide the impetus these lagging states need to avoid expansion, and even hinder implementation in states that have already committed. Seventeen million Americans could qualify for the Medicaid expansion, including one in ten AAs and one in eight NHPIs.

The ACA's Prevention and Public Health Fund (Public Health Fund) is particularly vulnerable. The Public Health Fund is the single largest federal investment in prevention efforts in U.S. history. Originally allocated $15 billion over the first decade, the Public Health Fund aims to transform the U.S. health delivery system from a treatment to prevention model. The Public Health Fund is designed to make critical investments and reforms in the nation's health care system, including improving public health infrastructure, responding to rising health costs and coordinating prevention strategies across federal agencies and communities.

Any budget and deficit negotiation spells big concerns for health advocates, public health professionals and communities because Congress has already chipped away at the fund. And House Republican leadership have repeatedly attacked the Public Health Fund and labeled it a "slush fund." Without a new deal, the Public Health Fund is slated to be cut by 7.6 percent or $76 million.

Both political parties agree on one thing: Avoiding the fiscal cliff is the number one priority for action. How that happens, however, is of paramount importance. Public health investments, funding for health reform implementation and funding for federal agencies that advance health could be on the chopping block. The fiscal cliff is bad for the economy and bad for public health. Congress and the administration must work together to protect the nation's economy and ensure all Americans have a chance at a healthy future.