from National Family Voices:
As reported in earlier Updates, the House and Senate have adopted a concurrent budget resolution - the first step in the ACA repeal process. At this point it is entirely unclear when there will be any repeal and/or replacement legislation. A recording of a closed-door meeting at the Republican congressional retreat last week reveals disagreement within the party about how and when to proceed with repeal and replacement of the ACA. Some Members are anxious to get the repeal done, since that's what the president and many Members of Congress promised during their campaigns. Others caution that they should proceed without haste, fearing that repeal without replacement will cause a collapse of the individual insurance market, which would be blamed on the Republicans. While most Members of Congress would probably be happy to replace the ACA at the same time they repeal it, there is no consensus on how to do so.
A particularly thorny issue involved in ACA repeal is what to do about the law's Medicaid expansion. Before the ACA, childless adults were not eligible for Medicaid. The ACA as written would have required every state to provide Medicaid coverage to all individuals with incomes below 100 percent of the federal poverty level, providing significantly enhanced federal matching payments to states for the cost of covering those who were previously ineligible (the "expansion population"). The Supreme Court effectively made this Medicaid expansion optional for states. As of January 2017, 32 states (including the District of Columbia) have taken up the expansion option. Thus, if the Medicaid expansion provision of the ACA is repealed, these states will lose millions of federal dollars, with significant ramifications for the state's health care providers, cities and counties, and/or taxpayers. This creates a dilemma for Members of Congress wishing to repeal the ACA and cut federal spending without hurting their own states that have expanded Medicaid. At least 8 Republican Governors are warning Congress about the consequences of repeal, including: Utah Gov Herbert, Massachusetts Gov. Baker, Arizona Gov. Ducey, Michigan Gov. Snyder, Ohio Gov. Kasich, Arkansas Gov. Hutchinson, Nevada Gov. Sandoval,and Kentucky Gov. Bevin. (See positions of specific Republican governors.)
A January 24 letter from the National Governors Association to congressional leaders reflects this problem. The letter requests that Congress consider several factors as they undertake health care reform, including the need to involve governors in the development of legislation. The governors seek flexibility, but say "it is critical that Congress continue to maintain a meaningful federal role in this partnership and does not shift costs to states," and that reforms "should protect states from unforeseen financial risks - such as the recent economic downturn or higher costs due to new drugs, treatment, or epidemics - that could result in a spike in Medicaid enrollment or increased per-beneficiary costs."
As noted in last week's Update, Members of Congress have heard from many constituents who oppose ACA repeal in the absence of a simultaneous replacement. As of last week, at least 10 Republican Senators were on the record expressing concern about repeal without replacement, including: Sen. Alexander, Sen. Collins, Sen. Corker, Sen. Cotton, Sen. Flake, Sen. Isakson, Sen. Johnson, Sen. McCain, Sen. Murkowski, Sen. Paul, and Sen. Sullivan.
- To see how the ACA has impacted your state, see ACA state fact sheets developed by HHS.
- To see how ACA repeal might affect your state, see state fact sheets on ACA repeal from Families USA.
- For state-specific data on Medicaid coverage, access and financing, see state Medicaid fact sheets from the Kaiser Family Foundation.
- The National Academy for State Health Policy (NASHP) has developed a chart which provides an overview of ACA provisions and a snapshot of the implications for state health insurance laws and regulations and a number of other consequences if the ACA is repealed.
As noted above, there is no consensus about how to replace the ACA while retaining its popular consumer protections. Several Members of Congress have proposed ACA alternatives, but the administration has not yet done so. It is possible that it will, once Rep. Price is confirmed as HHS Secretary, assuming that happens. (There was an abrupt cancellation of a vote on his nomination scheduled in the Finance Committee .) Such a proposal could be based on a plan put forward by HHS Secretary-nominee Rep. Price in 2014 or a similar plan put forward by House Speaker Paul Ryan (R-WI) in his "Better Way" health care proposal. Among other things, both plans would provide tax credits to purchase insurance, encourage the creation of Health Savings Accounts (from which pre-tax dollars could be used to purchase health care), and allow the sale of health insurance plans across state lines. Senate Democratic Leader Chuck Schumer (D-NY) indicated that Senate Democrats would be willing to work with Republicans to develop an ACA replacement plan, but would do so only before repeal of the ACA.
Recently, several Senators have developed replacement bills:
Cassidy-Collins bill. On January 23, Senators Bill Cassidy, MD (R-LA), Susan Collins (R-ME), Shelley Moore Capito (R-WV) and Johnny Isakson (R-GA) released legislative text for the Patient Freedom Act of 2017, a comprehensive replacement plan for Obamacare. Among other things, the bill would repeal the ACA's individual and mandates to have insurance, and its "essential health benefit" requirements while retaining some consumer protections, including the prohibitions on annual and lifetime limits, and coverage of treatment for mental health and substance use disorders. The bill would also create high-risk pools for people with pre-existing conditions. (For more details, see Senator Collins' website.) During the past week, there have been several summaries and analyses of the Cassidy-Collins bill, including a thorough summary by Tim Jost, a blogger for Health Affairs, and an analysis from the Center for Budget and Policy Priorities. The National Health Law Program has prepared a three-page critique, Nine Things to Know About the Cassidy-Collins' Replacement. Joan Alker, Executive Director of the Georgetown Center for Children and Families, blogged about the Cassidy-Collins proposal and the idea of ACA replacement in general.
Rand Paul bill. Senator Rand Paul (R-KY) has also developed and introduced ACA replacement legislation (S. 222), as described in this press release and this CNN story.
On January 19, Senate Finance Committee Ranking Member Ron Wyden (D-OR), along with every Democratic member of the Committee, today sent a letter to all governors (Democrats and Republicans) asking for feedback on the expected impact of Republican proposals to block grant or cap Medicaid. Responses are requested by . In December, Finance Chairman Hatch (R-UT) and the other Republican committee members sent a letter to all Republican governors and insurance commissioners asking for their input on Medicaid reforms and inviting the governors to a January Roundtable discussion about the issue. The Roundtable took place on January 19, with ten Republican governors participating.
On January 26, the Medicaid and CHIP Payment and Access Commission (MACPAC) held a meeting at which they discussed possible options for Medicaid restructuring, and released related reports. (See Information section, below.)
For some years, some conservatives have proposed restructuring the Medicaid program into a block grant to states - meaning each state would get a fixed amount based on its historical costs but not related to current state Medicaid enrollment numbers ̶ or paying states a limited amount per person covered (per capita cap). The Trump administration has also said it favors this type of Medicaid restructuring. Block grant proposals entail giving states much greater flexibility in determining Medicaid eligibility and benefits. Block grant proponents argue that this would allow states to innovate in ways that would serve beneficiaries more efficiently. But the congressional proposals to restructure the federal financing of Medicaid all involve cutting federal contributions to states compared to what they would get under the current entitlement structure of the program. Thus, states, localities and health care providers will have to bear relatively more and more costs as time goes on. See Republican ideas for healthcare reforms could spell trouble for U.S. states (Reuters article).
For more information about block grants and per capita caps, see:
- Everything You Need to Know about Block Grants, from Kaiser Health News
- Caps on Federal Medicaid Funding Would Give States Flexibility to Cut, Stymie Innovation, from the Center for Budget and Policy Priorities.
- Alternative Approaches to Medicaid Financing: Background and Context, from MACPAC
- Alternative Approaches to Medicaid Financing: Choice of Design Elements in Alternative Financing Proposals, from MACPAC