Next week, Congressional Republicans will vote on the Graham-Cassidy bill supposedly designed to “repeal and replace” Obamacare. Shockingly, they will do so without a score from Capitol Hill’s nonpartisan scorekeeper, the Congressional Budget Office (CBO). As the office led by the GOP’s hand-picked director Keith Hall warned last Monday, “CBO will not be able to provide point estimates of the effects on the deficit, health insurance coverage, or premiums for at least several weeks.”
Nevertheless, there are many things we already know with a good deal of certainty about this grotesque act of right-wing political spite masquerading as health care legislation. Graham-Cassidy begins by eliminating the individual and employer insurance mandates next year, and repealing the Affordable Care Act’s insurance subsidies and Medicaid expansion in 2020. The bill then dramatically slashes currently projected Obamacare spending and divvies up what remains as block grants to the states. The states in turn can seek waivers from requiring the coverage of Obamacare’s “essential health benefits” (EHB’s) and the current ban on discrimination against those with pre-existing conditions. Estimates from Avalere Health and CBPP forecast the GOP bill carves between $215 billion and $243 billion from ACA spending over the next decade. But those block grants—which rob billions of dollars from largely Democratic-led, Medicaid-expanding states to those red states which did not—expire at the end of 2026. Unless the bill is reauthorized, the states will lose $299 billion in federal funding in 2027 alone; between 2020 and 2036, the loss is a staggering $4.15 trillion. Based on CBO estimates for similar Republican proposals earlier this year, the Commonwealth Fund warned 32 million people could lose their insurance by 2027.
Oh, and one other thing we can count on: If Sens. Lindsey Graham and Bill Cassidy get their way, thousands of newly uninsured Americans will die needlessly every year. A death toll of roughly 18,000 in the law’s first full year could approach 40,000 in 2027. The question is not whether the United States will suffer the equivalent of multiple Sept. 11 attacks every year, but how many.
It’s no wonder patients’ groups, the AARP, the American Medical Association, hospital groups, and insurers are unanimously opposed to Graham-Cassidy. Of course, Donald Trump and almost all Senate Republicans support the bill, though not necessarily because they are enthusiastic about what it does. As Axios reported, most of the GOP’s best and brightest don’t even know what’s in it. As one Republican aide admitted:
"If there was an oral exam on the contents of the proposal, graded on a generous curve, only two Republicans could pass it. And one of them isn't Lindsey Graham.”
For his part, Louisiana Sen. Bill Cassidy knows, but insists on lying to the American people. It’s simply not true that “more people will have coverage” under his legislation or “we protect those with pre-existing conditions.” (The president is a liar on this point as well.) Graham-Cassidy’s state waivers and per-capita caps on the pre-ACA Medicaid program mean that Dr. Cassidy is committing malpractice when he says neither seniors nor children born with illnesses will be guaranteed “the coverage they need.”
No, the Grand Old Party’s goosestep to next week’s vote is about political payback, pure and simple. Republican candidates promised the party’s hard-line base they would repeal Obamacare. And they are running out of time to do so. With less than a week left until the Sept. 30 deadline imposed by the Senate parliamentarian, Kansas Sen. Pat Roberts fretted that Graham-Cassidy is “the last stage out of Dodge” and warned that “if we do nothing, I think it has a tremendous impact on the 2018 elections.” Chuck Grassley, previously best known for proclaiming Obamacare would “pull the plug on grandma,” admitted the actual provisions in the legislation had little to do with Republican urgency to pass it:
“You know, I could maybe give you 10 reasons why this bill shouldn’t be considered. But Republicans campaigned on this so often that you have a responsibility to carry out what you said in the campaign. That’s pretty much as much of a reason as the substance of the bill.”
For Grassley and company, keeping their Obamacare repeal promise to the MAGA crowd—and avoiding primary challenges in 2018—is reason enough to destroy the American health care system. Especially when, as Sen. Rand Paul rightly noted, the bill is “a game of Republicans sticking it to Democrats.”
Co-sponsor Lindsey Graham has made no secret that blue state payback is a feature—and not a bug—of his bill:
So, what we did this will repeal the individual and employer mandate, and medical device tax. We left the other taxes in place and created a block grant. Under Obamacare, 4 states got 40% of the money. That’s New York, California, Maryland, and Massachusetts. They’re 20 percent of the population and so by 2026 our goal is to have parity. It will be roughly the same no matter whether you live in South Carolina or California. We help states that did not expand their Medicaid under Obamacare catch up. High-cost expansion states will have a glide path down to a number that will be parity by 2026.
Graham’s Louisiana colleague put a slightly different spin on the bogus complaint of the ACA’s supposed unfairness to red states. As Cassidy put it this week, “There will be billions of dollars of coverage for working families in states like Maine, Virginia, Missouri, Florida and elsewhere, states that have been bypassed by Obamacare.” In a floor speech on Monday, the South Carolinian launched another War Between the States:
“I like Massachusetts, I like Maryland, I like New York, I like California, but I don’t like them that much to give them a bunch of money that the rest of us won’t get. Now, if you live in Massachusetts, you don’t get twice the Social Security or 50 percent more than if you live in Pennsylvania. Now how can this happen? Obamacare, for whatever reason, favors four blue states against the rest of us.”
But there’s no mystery about what Graham’s “whatever reason” might be. Obamacare, also known as the Affordable Care Act, was designed to provide the most aid to the states with the largest uninsured populations. But after successfully suing to make Obamacare’s Medicaid expansion optional, most GOP-led states simply refused to do so. (It is also worth noting that while Uncle Sam pays on average 57 percent of “unexpanded” Medicaid in the states, Republican strongholds in the South like Mississippi get 75 percent of their funding from the federal government.) Between them, Texas and Florida could have extended health insurance to well over 3 million people had they simply said “yes.” They weren’t “bypassed by Obamacare”; these GOP states simply passed on Obamacare.
While these and states like Virginia, Missouri, and Maine lost billions in federal funding, others including Arkansas, Kentucky, and later Louisiana experienced dramatic declines in the ranks of their uninsured residents.
But if the charge of “blue state favoritism” is one scam being perpetrated by the proponents of Graham-Cassidy, so too is notion that some states will get “billions more dollars to provide health insurance coverage.”
In the short term, it is true that some states will benefit under the GOP’s “bash blue/reward red” formula. As this New York Times chart reveals, the five states which lose the most under Graham-Cassidy’s block grants and per-capita limits all expanded Medicaid and voted for Hillary Clinton for president. The 15 winners all refused to expand Medicaid; 14 of them voted for Donald Trump.
But beginning in 2027, all states lose federal dollars under the Graham-Cassidy bill. Unlike the current Obamacare law, the funding for the GOP “replacement” ends after 2026. In 2027 alone, the projected Obamacare spending for Medicaid expansion and premiums subsidies would drop from $299 billion to zero. As Avalere Health warned:
Years 2020-2036: Finally, given the long-term impacts of the Medicaid per-capita caps, particularly the shift to lower per capita cap growth rates in 2025, and lack of block grant funding beyond 2026, all states would see a reduction in federal funds relative to current law by 2036 (Figure 3). Federal funding reductions range from $4B in South Dakota to $800B in California.
“A combination of slower Medicaid per-capita cap growth rates and the sunsetting of block grant funding would lead to substantial reductions in federal funds going to states through 2036,” added Chris Sloan, senior manager at Avalere. “The largest negative funding impacts of this bill to states are outside the current 10-year budget window.”
That “10-year budget window” is Graham-Cassidy scam No. 3. Republicans can at least try to claim that some states will benefit under their law between now and 2026. The CBO numbers, which as noted above may not be available for weeks, may well reflect that. But in the years after that budget window, the Graham-Cassidy legislation turns into a pumpkin. Again, from Avalere:
Importantly, the block grant funding appropriated in the bill ends after 2026. While funding for 2027 and beyond may be appropriated in the future, the bill currently creates a block grant funding cliff in 2027. The ability of the Congress to appropriate additional funding is uncertain and could be constrained by the need to offset the cost.
To put it another way, Graham-Cassidy is scheduled to die at the end of 2026. And there’s certainly no guarantee that Congress—especially Republicans in the House and Senate—will try to resuscitate it. And that’s more than a little ironic. After all, every CBO forecast of the Affordable Care Act found that Obamacare reduced the national debt; every score by the agency found its repeal would increase federal budget deficits. Then-House Majority Leader Eric Cantor denounced the CBO for “budget gimmickry.” Newt Gingrich said simply, “it lies.”
When Senate Majority Leader Mitch McConnell brings the Graham-Cassidy-Heller-Johnson abomination to a vote next week, he’ll do so without knowing the CBO’s projections for its budget, its impact on premiums and out-of-pocket costs, and its effect on the number of Americans who will retain insurance coverage. Nevertheless, based on the House “American Health Care Act,” the earlier Senate “Better Care Reconciliation Act,” and other versions of GOP Obamacare “repeal and replace” legislation, we can make some pretty solid estimates now. As the Center for American Progress explained:
Graham-Cassidy’s impact on coverage in 2027 would be similar to that of the Obamacare Repeal Reconciliation Act (ORRA), the so-called “repeal and delay” bill that the Senate failed to pass in July. Under both the ORRA and Graham-Cassidy, these three major policies would be in effect a decade from now:
- Repeal of the mandates for individuals to obtain health insurance coverage and large employers to offer insurance
- Elimination of subsidies for nongroup health insurance
- Elimination federal funding for the ACA’s Medicaid expansion
The CBO estimated that the ORRA would have resulted in tens of million more uninsured in 2026. It projects that Medicaid would cover 19 million fewer people and that the individual market, with 23 million fewer people, would nearly disappear. Although the CBO expects that about 11 million more people would have coverage through an employer, the ORRA’s net effect would be 32 million fewer people with coverage in 2026.
In its analysis, The Commonwealth Fund concurred, warning “the latest ACA repeal bill would lead to a loss of health insurance for at least 32 million people after 2026.” In addition:
CBO’s prior analyses of the elimination of the individual mandate found that 15 million to 18 million people would become uninsured in the first full plan year after enactment (in this case 2019), as people dropped their coverage from all sources and insurers left the marketplaces. CBO also projected that premiums in the individual market would climb by 15 percent to 20 percent in the first plan year.
Under Graham-Cassidy, policyholders would face a triple whammy. As younger, healthier people opted to go without insurance (which would no longer be required), premiums would jump for older, sicker Americans still in the insurance pool. Making matters worse, states could eliminate Obamacare’s 12 essential health benefits and enable insurers to charge whatever they wanted for those with pre-existing conditions, which would lead to spiraling premiums and out-of-pocket costs. (As the Brookings Institute and other analysts have cautioned, tens of millions of Americans with employer-provided insurance would not be protected from these Graham-Cassidy changes.) And at the same time, states would be free to shift block grant money away from subsidizing premiums to other approaches.
But even without taking those factors into account, the United States would see millions of currently insured people lose their coverage and millions more face financial ruin. And then there’s the body count. Based on research from Massachusetts, the first full year of Graham-Cassidy could see 18,100 unnecessary deaths among the newly uninsured. By 2027, the death toll could reach 38,600.
As I’ve documented elsewhere (“GOP Obamacare repeal will be an annual death sentence for thousands”), there is a substantial body of research on the mortality rates of the uninsured. Several studies predating the implementation of the Affordable Care Act put the annual death toll at between 22,000 and 45,000. In 2014, a team of researchers from Harvard Medical School warned that states which refused to expand Medicaid would experience between 7,100 and 17,100 additional deaths based on average mortality rates for the uninsured between 0.091 percent and 0.220 percent.) But as Vox also reported in July (“208,500 additional deaths could occur by 2026 under the Senate health plan”), the Massachusetts health care law upon which Obamacare was based found one fewer death for each additional 830 people insured. Using that mortality rate of 0.12 percent, the Commonwealth Fund’s estimate of 15 million losing insurance in the first full year of Graham-Cassidy produces about 18,100 extra deaths in 2019. As the projected number of additional uninsured jumps to 32 million in 2027, that year’s American carnage reaches 38,600 dead.
And that’s the steepest price of all that the American people will pay if Graham-Cassidy becomes the law of the land. If Senate Republicans pass that bill and the president signs it, it won’t be because “restoring decision-making back to the states is always a good idea” or because “as a general rule the states do things better than the federal government does.” (The entire history of Medicaid and Medicaid expansion proves that is untrue.) And it won’t be because Graham-Cassidy-Heller-Johnson will improve the health of Americans; the bill is designed for Congressional Republicans suffering from Irritable Base Syndrome (IBS) and no one else. Born out of spite, Graham-Cassidy is a scam. And a deadly one at that.