WASHINGTON – Congress must work to improve Puerto Rico's treatment under Medicaid as well as to expand access to tax credits and other federal benefits for the commonwealth, the secretaries of the Treasury Department and Department of Health and Human Services said in a letter on Friday.
Treasury Secretary Jack Lew and Health and Human Services Secretary Sylvia Burwell made their requests to the eight-member Congressional Task Force on Economic Growth in Puerto Rico, which was created under the PROMESA law to, among other things, explore possible federal improvements that could bolster job creation, reduce child poverty, and attract investment in the commonwealth.
The task force is soliciting comments from interested parties through Sept. 2.
"We are encouraged by Congress's attention to the need for additional action to enable growth in Puerto Rico, building on the strong foundation PROMESA established," Lew and Burwell wrote. "Any serious proposal for Puerto Rico's future growth starts with addressing the inadequacies of Puerto Rico's treatment in the Medicaid program; without addressing that challenge, a return to growth and opportunity will be a significant challenge."
The two highlighted several current problems with Medicaid in Puerto Rico when compared to the rest of the U.S. These include a cap, fewer benefits for beneficiaries, and fewer federal government contributions on a per-capita basis than in the rest of the country. One-time additional funds that the Affordable Care Act (ACA) provided will also soon be exhausted, possibly as early as December 2017, and that could leave up to 900,000 Americans living in the territory without health care coverage, the two secretaries said.
Lew and Burwell told the task force that Congress needs to work to raise the standard of care, strengthen program integrity, prevent unstable Medicaid financing from further hurting the commonwealth's economy, and avoid a drop in coverage when the ACA funds expire. Congress should also focus on improving long-term services for Medicaid enrollees, they said.
Another way Lew and Burwell suggested Congress could grow Puerto Rico's economy is through the extension of the Earned Income Tax Credit to the commonwealth, which has the lowest labor market participation in the U.S. The EITC, which gives low and moderate-earning individuals tax credits based on their income, "would pull 54,000 Puerto Ricans out of poverty and increase Puerto Rico's gross national product by $1.05 billion, or 1.5%," they said.
Additionally, Congress should consider expanding the Child Tax Credit and take time to make sure that Puerto Rico's statistical methodologies for calculating economic growth are made current and in line with the rest of the country.
Burwell and Lew proposed Congress consider building on existing federal initiatives that are already benefitting Puerto Rico, like one with the help of the Department of Commerce that led to locating on the island several facilities devoted to aerospace and defense research and development technologies. Inclusion of Puerto Rico infrastructure needs in other projects from the Departments of Transportation and Agriculture have also led to positive economic developments that could even further expanded with Congress's help, Lew and Burwell wrote.
The congressional task force is chaired by Sen. Orrin Hatch, R-Utah. Its members include Sens. Robert Menendez, D-N.J., Marco Rubio, R-Fla., and Bill Nelson, D-Fla., as well as Pedro Pierluisi, Puerto Rico's sole and nonvoting representative in Congress, and Reps. Tom MacArthur, R-N.J., Sean Duffy, R-Wis., and Nydia Velázquez, D-N.Y.
The task force must write a report by Dec. 31 of this year that identifies any current impediments federal law and programs put on economic growth or health care coverage for the territory as well as recommendations to fix them. The task force also is required to provide a status update on the information that it has collected by mid-September.
