Common Good Iowa

Guest opinion: Tax cuts over healthy moms and kids

May 8, 2024

Tax cuts over healthy moms and kids

Quad-City Times

Dubuque Telegraph Herald

May 8, 2024

By Anne Discher, Executive Director, Common Good Iowa

In a matter of days Governor Reynolds is signing two bills that, at first blush, may seem to have little in common. But they are driven by the same impulses: prioritizing tax cuts over Iowans’ healthy futures.

Last Wednesday, she signed the bill accelerating Iowa’s move to a flat-rate personal income tax, overwhelmingly benefiting the richest Iowans and setting up eventual budget cuts to services like health care.  

This Wednesday, she is scheduled to sign a bill cutting pregnancy Medicaid coverage from some working Iowans and using the savings to expand postpartum coverage for those who remain eligible.  

For years, people eligible for Medicaid coverage because they were pregnant lost that coverage just 60 days after giving birth. That is a terrible time to lose coverage: in the midst of the critical postpartum period. Iowa is one of the very last states to take up the federal option to help lower troubling maternal mortality rates by expanding that coverage to one year postpartum.

The obvious and long-overdue path was expanding postpartum coverage for all Iowans eligible for pregnancy Medicaid under current rules. But instead, Iowa lawmakers agreed to expand postpartum coverage only by coupling it with alarming cuts to Medicaid pregnancy coverage.

They cut the income eligibility level by over 40%, to 215% of the federal poverty level, or about $32,000 for a single person and about $44,000 for a family of two. This change will leave pregnant people no longer eligible for Medicaid, most of them working at modest wages not so far above the new cutoff, with only bad choices. They can forgo prenatal care that helps ensure a healthy birth or rack up medical debt.

The Legislative Services Agency estimates that when the new law takes effect, 2,300 Iowans a month eligible for pregnancy coverage under the new income cap will gain extended postpartum coverage, but 1,700 others — 1,300 moms and 400 babies, whose Medicaid coverage was tied to their mother’s eligibility — will no longer get Medicaid at all.

At a time of big surpluses, it begs the question: Why such cuts? Why 215% of poverty?

Well, it’s notable that at that level, after a transition period, the cost of the new law is nearly revenue neutral. In other words, the cost savings from cutting people off coverage almost equals the cost of the postpartum expansion.

A coincidence? Maybe, maybe not. But in a session where lawmakers spent only 79% of the funds available for appropriation, it’s obscene either way.

Then again, when your top goal is holding down services just to keep passing those sweet, sweet tax giveaways mainly for the rich — people who don’t need Medicaid — it makes all the sense in the world.

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Anne Discher is executive director of Common Good Iowa. Contact:

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