Senators Bill Cassidy (R-LA) and Lindsay Graham (R-SC), along with co-sponsors Dean Heller (R-NV) and Ron Johnson (R-WI), released a revised version of legislation to repeal and replace the Affordable Care Act (ACA) this week, often referred to as the Graham-Cassidy bill. The Senators claimed that the bill includes no “draconian cuts.” In substance, however, the Graham-Cassidy bill retains many of the components of recent failed attempts to undo the ACA.
The Graham-Cassidy bill would have the same harmful consequences as earlier bills. It would cause many millions of people to lose coverage, radically restructure and deeply cut Medicaid, increase out-of-pocket costs for individual market consumers, and fail to adequately protect people with pre-existing conditions from higher costs.
The bill eliminates expansion Medicaid, which provides coverage for 11 million lower-income adults. It also wholly eliminates ACA’s Marketplace subsidies which currently help almost 9 million people afford coverage, a departure from earlier bills which replaced subsidies with more modest assistance. The proposal replaces expansion Medicaid and Marketplace subsidies with block grants to states that would cut federal funding on health care coverage by $239 billion dollars by the year 2026. These grants also redistribute funds between states – sending more money to those states that did not expand Medicaid under the ACA and making deeper cuts to those state that expanded coverage. Because a block grant provides a fixed amount of funding for states each year, the proposal also leaves states on the hook for any and all unexpected costs from recessions, natural disasters, public health emergencies, or prescription drug price spikes.
On top of these cuts, the Graham-Cassidy bill would also cap and cut Medicaid for older adults, people with disabilities, and families with children, slashing Medicaid by $175 billion between 2020 and 2026. These cuts would grow much larger in coming decades, just as our population ages. That’s because, starting in 2025, the bill would further cut the annual adjustment of its Medicaid per-capita (or per-person) cap on spending well below projected increases in costs. Faced with less funding from the federal government and increased costs, states would have no choice but to institute deep cuts in needed health care and long-term services and supports for older adults, people with disabilities and families with children.