How nonprofits will shoulder burden of Trump megabill

As President Donald Trump’s budget reconciliation bill aims to target key cuts to the nation’s social safety net, nonprofits are bracing to fill widening gaps in services. 

With anticipated changes to Medicaid expected to impact over 1.5 million New Yorkers – the bill’s tightening work and re-certification requirements could potentially boot people off their coverage while discouraging new members to enroll. 

For those suffering from chronic illness, these changes to Medicaid (and in turn Medicare) could leave them particularly vulnerable – as most enrollees often struggle to meet basic living requirements like housing and food security. The bill’s anticipated cuts to SNAP benefits and food assistance programs are expected to corner low-income New Yorkers into greater vulnerable outcomes – leaving the city’s fleet of stressed nonprofits to pick up the slack. 

For those suffering from severe illnesses and special needs care, these changes can be especially costly to both enrollees and providers. 

Nonprofits brace for impact 

In championing care models aimed at reducing Medicaid costs, Fountain House has claimed to save members upwards of $700 a month in mental health and medical expenses, amounting to nearly $11,000 in public savings per member. 

“We actually reduce Medicaid costs of 21% every time somebody becomes a clubhouse member, it actually is about a 35% to 40% reduction in crisis care costs and an increase in primary care, which is exactly what you want,” said Ken Zimmerman, CEO of Fountain House. 

Through fostering therapeutic communities for individuals struggling with severe mental illness, Fountain House’s non-clinical clubhouses have helped reduce hospitalization rates among other cost-saving measures like treating underlying health conditions like diabetes or heart disease. 

Yet for the 90% of its members on Medicaid and 30% receiving SNAP benefits, the budget reconciliation bill's proposed work and re-certification requirements may lead to vast disruptions for enrollees and the nonprofit workforce. From possibly disrupting treatment plans to increasing administrative burdens for both members and staff, more resources could be directed away from critical programming. 

“In the substantial scenario planning we're doing – we're looking at whether we're going to have to reallocate staff to help our members manage the administrative requirements, whether that is about getting an exemption or qualifying for it,” said Zimmerman. “We've had to reallocate and examine where and how we may have to be prepared to make cuts or changes in what we do on a very practical level.” 

In addition to keeping people from falling out of plans, the megabill’s proposed changes could spell out more work for nonprofit health providers. 

New York’s Essential Plan, which provides healthcare to nearly half of the state’s legally authorized immigrants is expected to take the biggest hit – possibly forcing 730,000 New Yorkers to lose coverage. According to Public Health Solutions, an anticipated 224,000 people may immediately lose their insurance, many being undocumented individuals. 

“It's anticipated that many New Yorkers will lose their coverage. The nonprofit social safety net, the healthcare and social service providers of last resort, will carry the mantle,” said Zachariah Hennessey, chief strategy officer and executive vice president of WholeYouNYC, Public Health Solutions’ citywide community resource network that connects New Yorkers to community health partners. “The burden will fall on them to provide healthcare and to provide social services.” 

Navigating through nearly $300 million in withheld federal funds, community health centers may struggle to meet added demand, putting potentially vulnerable people at risk. 

Putting vulnerable people at risk 

With the megabill’s intention to dismantle social safety nets, those who suffer from chronic and more severe illnesses may be at risk of losing potentially life-saving coverage. According to Amida Care, a New York state Medicaid managed health care plan over 40% of people living with HIV in the United States currently rely on Medicaid to cover costs. 

With the budget reconciliation bill potentially discouraging people from accessing services, providers anticipate that patients in need of special care may neglect treatment. 

“What's really disturbing about this is that we're closer than ever to ending the HIV epidemic in New York,” said Lyndel Urbano, senior director of public policy & government relations at Amida Care. 

“You can have all the right treatments for people, but if they go hungry or find it difficult to get to and pay for medical care, the folks that need treatments won't be able to access them, Urbano said. “It creates distrust in the system. It creates holes in a system that's already precariously balanced.”

While groundbreaking strides have been made in longer-acting HIV medication, federal efforts to cut HIV prevention funding will lead to added barriers, destabilizing access to consistent and sustained treatment. 

Destabilizing another delicate end of the safety net, stricter eligibility requirements for SNAP benefits are expected to put nearly 1.2 million food insecure New Yorkers at risk. With 300,000 households statewide expected to lose their monthly SNAP benefits, these slashes are bound to strain emergency food pantries and worsen health outcomes. 

“Everything's connected together,” said Jeanie Tse, senior medical director at Fountain House and an associate professor of Psychiatry at the NYU School of Medicine. “If you take away one thing, this delicately built house that we have – this safety net is going to fall down and cost more. If you break a system, you can rebuild it, but it takes so much more cost and time to do that.”