Unpacking Graham-Cassidy: opportunities and red-flags


This week’s health policy news roundup curated by Jane M. Orient, M.D. | Roundup Archive

Obamacare repeal is on the brink of coming back from the dead,” says Politico, referring to the Graham-Cassidy-Heller-Johnson (GCHJ) bill. Republican leaders will push it in great haste because of the September 30 deadline, the last day when the budget reconciliation process can be used to pass it with a simple majority. Without that process, Senate Democrats can block any action by requiring a 60-vote majority. http://www.politico.com/story/2017/09/17/obamacare-senate-republicans-repeal-242821

The GCHJ bill does not repeal the Affordable Care Act (ACA). It is a break with other Republican repeal efforts, which replaced ObamaCare’s exchange subsidies with less-generous tax credits. The main insurers’ lobby, America’s Health Insurance Plans, opposes the bill because insurers will get less federal money.

Sen. Cassidy’s big idea is block grants. “The bill would pool money being used to subsidize Obamacare customers and expand Medicaid in parts of the country and siphon it back to the states as block grants, writes Tom Howell, Jr. “Money direct to States!” President Trump tweeted. About 16 states would get more money than under current law, and others would get less. So governors of states that will get less federal money than anticipated are opposing the bill. http://www.washingtontimes.com/news/2017/sep/20/mitch-mcconnell-senate-will-take-obamacare-repeal-

“One of the most interesting reforms in Graham-Cassidy,” writes Avik Roy, “is that, over time, it ends a significant bias in the Medicaid program toward wealthy states like California, Massachusetts, New York, and Maryland.” https://www.forbes.com/sites/theapothecary/2017/09/17/take-two-inside-bill-cassidys-plan-to-replace-obamacare/

Among HSA-friendly language in the legislation, the bill contains provisions allowing Health Savings Accounts to fund Direct Primary Care arrangements.

It will be difficult for the Congressional Budget Office (CBO) to score the bill because it cannot know what the states will do. States could waive costly requirements of ObamaCare, or use the money to help develop their own single payer system. http://mailchi.mp/thetransom/the-transom-september-19-2017?e=0a7fbc92f5

The best argument in favor of the GCHJ proposal, according to Benjamin Domenech, is that it would “break up the existing dynamic in Washington surrounding Obamacare repeal and transform it into 50 different battles.” http://mailchi.mp/thetransom/the-transom-september-20-2017?e=0a7fbc92f5

As Twila Brase of the Citizens’ Council for Health Freedom points out, GCHJ zeroes out the penalties for the individual and employer mandates, but leaves them in place so that they could be increased later. Among many other defects, it repeals only the smallest of ACA’s 19 taxes, and ACA insurance regulations remain nationalized and under federal control. http://www.cchfreedom.org/cchf.php/1347

The September 30 deadline is fake news, writes Christopher Jacobs. The Senate parliamentarian does not have unlimited power. The question is whether Senators have the political will to pursue other options. http://thefederalist.com/2017/09/20/september-30-deadline-obamacare-repeal-fake-news/

Mr. Jacobs has also published a 12-page section-by-section summary of the 140-page bill. Senator Cassidy has put out a 20-page summary.

Despite its many defects, conservatives might support this bill because of its opportunities, writes Daniel Horowitz: “It has the potential, very indirectly, to reduce the price of health care and, for the first time ever, create a market for consumer-driven health care on the ruins of government-run health care that is now destroying itself.” He notes that everyone in Washington is “focused on fixing the pre-Obamacare system, run by the insurance cartel just as much as Obamacare is, rather than solving the root cause of higher prices and terrible delivery of health care itself.” A better goal is to “burn down the insurance cartel and help the consumer escape to a system of health-sharing associations and direct primary care.” https://www.conservativereview.com/articles/how-to-save-free-market-health-care-out-of-the-ruins-of-obamacare

This statement, however, has a big qualifier: provided that the bill doesn’t make the status quo even worse. Horowitz has so far identified three red flags:

(1) “A health insurance issuer may not vary premium rates based on an individual’s sex or membership in a protected class under the Constitution of the United States.” Imagine what politically correct “protected classes” might be carved out.

(2) The bill forces states to expand government-run medical care by tying regulatory relief to acceptance of Medicaid expansion grants. Horowitz states: “Medicaid expansion has been a boon for the hospital cartel and has destroyed any semblance of market-based health care.”

(3) A state bailout fund would codify ACA’s illegal cost-sharing subsidies for three years, which could be expanded indefinitely. https://www.conservativereview.com/articles/3-red-flag-provisions-in-the-graham-cassidy-health-care-bill

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