President Trump has proposed a budget that increases government spending from $4 trillion today to $5.5 trillion in 2027. Only in the alternative reality of Washington can this be described as “budget cuts.” Looking at individual programs, it is a gross mischaracterization to state that spending on Medicaid programs will be cut. The new budget proposes to increase federal Medicaid spending from $378 billion a year today to $524 billion a year in 2027. It shows how far removed Washington is from everyday Americans for this increase of $146 billion to be called a cut. The fundamental problem is that special interests are addicted to the rising path of spending. Altering this path by increasing spending at a slower rate opens change-makers to extraordinary attacks.

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The entire Republican reform effort hinges on getting the tax credits right. A poorly-designed credit will lead millions to lose their health insurance and incentivize them to remain poor. It will harm efforts to reform the Medicaid program, because the insufficient tax credits won’t form a viable alternative. On the flip side: there is great opportunity in getting health reform right. The right kind of means-tested tax credit could make individual health insurance markets work for tens of millions of Americans. That success, in turn, could improve the opportunities for long-term entitlement reform, by giving Americans a robust option to buy insurance on their own.

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Should Republicans be worried that they will lose control of the House in 2018 because they adopted legislation that repeals Obamacare? Don’t bet on it. Under the current House bill, states could let insurers take a person’s health status into account when deciding how much to charge in premiums. According to the media narrative, this would take away coverage from those with pre-existing conditions. The public furor over this allegation is predictable, but that does not make pre-existing conditions an existential threat to Republican political chances in the next election. The GOP plan protects everyone who remains continually covered by health insurance and they cannot be charged more if they have a pre-existing condition.

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Republican legislators and policy experts are kicking around a novel way to increase health coverage: automatically enrolling millions of uninsured Americans into low-cost insurance plans.

The idea has shown up on the opinion pages of the Wall Street Journal and been discussed in private meetings of the Senate working group on health care.

“It’s a viable idea,” says Andy Slavitt, who ran Medicare under President Obama and is an ardent Affordable Care Act advocate. “What’s appealing about it to Republicans and to Democrats is you want people to have free choice but not be free riders.”

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The Trump administration and House of Representatives Monday asked a federal court for another 90-day delay in a lawsuit over Obamacare insurance subsidies. “The parties continue to discuss measures that would obviate the need for judicial determination of this appeal, including potential legislative action,” the House and White House wrote to the court. If the request is approved, the parties would have to file another update in 90 days. “We continue to work with the Trump administration on a solution,” said AshLee Strong, spokeswoman for House Speaker Paul Ryan.

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The Senate GOP will need to produce a bill that can claim to have significantly changed Obamacare, achieve at least the same amount of cost savings as the House bill did through the budgetary reconciliation process, and that will be able to garner support in both the Senate and the House. The Senate will also need to fix the simple fact that the age-adjusted, fixed-dollar tax credits to subsidize insurance coverage in the AHCA are too simple and insensitive to the income-related health needs of lower income Americans.

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GOP senators say they’re discussing a possible short-term bill if their health care talks drag on. It might include money to help stabilize shaky insurance markets with subsidies to reduce out-of-pocket costs for low-earning people and letting states offer less expensive policies. It’s unclear Democrats would offer their needed cooperation, but Republicans are talking about it. “We’ve discussed quite a bit the possibility of a two-step process,” said Sen. Lamar Alexander (R-TN), chairman of the Senate Health, Education, Labor and Pensions Committee. “In 2018 and ’19, we’d basically be a rescue team to make sure people can buy insurance.”

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House Republicans may face the possibility of having to vote again on the American Health Care Act (AHCA), which passed the House earlier this month. House Speaker Paul Ryan hasn’t yet sent the bill to the Senate because there’s a chance that parts of it may need to be redone, depending on how the Congressional Budget Office (CBO) estimates its effects. House leaders want to make sure the bill conforms with Senate rules for reconciliation, a mechanism that allows Senate Republicans to pass the bill with a simple majority. The CBO is expected to release an updated estimate next week.

The American Health Care Act (AHCA), which passed the House earlier this month, is a health care revolution. It isn’t about returning to the way things were. It’s about asking the country to imagine a system that has never existed before. Instead of offering a plan centered on Washington, D.C., the AHCA is centered on you. It empowers you and respects your relationship with your family and your doctor. It delivers to you increased access, benefits, choices and health savings. The opposition has been so intense precisely because the plan is so ambitious. One bogus argument government elites are using is the claim that thousands of Americans with pre-existing conditions will die if the AHCA becomes law. Actually, the bill includes “continuous coverage” protections for people with pre-existing conditions. For anyone with continuous coverage, pre-existing conditions do not apply.

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More than a dozen states and the District of Columbia filed a motion on Thursday to intervene in the appeal of a lawsuit targeting the ACA’s cost-sharing reduction (CSR) subsidies. The lawsuit was originally brought by the U.S. House of Representatives against the Obama administration, which the Trump administration must now deal with. The Kaiser Family Foundation has estimated that the average premiums for silver plans sold on the ACA exchanges would increase by about 19% to compensate for insurers’ lack of funding without the CSR payments. The Trump administration and the House are set to update the court on Monday on how they plan to proceed with the case.

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