Following a week of high-level negotiations among GOP senators, Republican leadership is planning a Tuesday vote on the motion to proceed to the House-passed American Health Care Act (AHCA) — the vehicle for their health care reform efforts. The process has been shrouded in confusion and uncertainty, as it still remains unclear what legislation Senate leaders ultimately hope to move forward. And while knowing what’s in the Senate bill may be, as Senate Whip John Cornyn said, a “luxury we don’t have,” it’s worth acknowledging that there’s still a narrow path towards passage.
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The Trump administration and Republicans in Congress find themselves in a position there never wanted to be in: heading into the August recess having failed to repeal and replace the Affordable Care Act (ACA), and also without any significant legislative accomplishments since the November 2016 election.
Before charting a new course, the GOP needs to understand how they drove themselves into this political ditch.
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A new government report explains why Republicans, after nine years of opposing Obamacare, are having such a hard time repealing it.
The answer: It’s pretty much about the money. It’s not about providing Medicaid coverage to low-income adults. Some moderate Republicans who profess concern for the needy are actually trying to shift more of the cost of providing them Medicaid coverage from their states to the federal government. They’re holding out for more federal cash for their states. And they just might get it – from Senate Democrats.
Obamacare made an offer to states that agreed to extend Medicaid eligibility to childless, nondisabled, low-income adults: The federal government would pay 100 percent of the medical bills for this new category of “expansion adults.” That percentage would slowly decline, but never fall below 90 percent. The District of Columbia and 31 states jumped at the offer.
The federal government pays a much lower federal matching percentage for every other category of recipients, including children, blind and disabled adults, pregnant women, and the frail elderly. That matching rate varies from 50 percent in states with relatively high per capita incomes (California, for example) to nearly 75 percent in the poorest state (Mississippi).
The Senate bill to “repeal and replace” Obamacare would leave the Medicaid expansion in place, but would ultimately eliminate the higher federal reimbursement for their care. The federal government would bear the same share of medical assistance for nondisabled, childless adults as it does for pregnant women and people with disabilities. It slowly phases out the current Medicaid reimbursement policy that discriminates on the basis of age, gender, pregnancy, and disability.
Some Senate Republicans are clinging to this inequitable arrangement that provides a sweet deal for their states.
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The House-passed bill left large numbers of Americans uninsured, in part because very low-income households could not afford to enroll in private coverage even with the House’s tax credits. Medicaid is the nation’s safety net insurance program. In practical terms, there is no real alternative to Medicaid for a person below the poverty line. Under the approach recommended here, federal Medicaid funding would be dispensed to the states to strengthen the safety net for the poor, even as there would be less support for expanding the program to persons with higher incomes.
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Congress can and should still move forward with important health care reforms to ease the burden on millions of American businesses and workers. The National Restaurant Association and the one million foodservice locations they represent have urged elected officials to make a few basic changes to relieve the burdens on businesses that are stifling growth and impacting their ability to hire new employees. Regardless of the Republican bill’s passage, legislative and regulatory constraints imposed by the ACA continue to negatively impact restaurants.
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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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Now that the House of Representatives passed a revised version of the American Health Care Act (AHCA) to replace the Affordable Care Act (ACA) the ball is in the Senate’s court. Despite calls to start from scratch, the Senate would be well advised to work off the structure of the AHCA. AHCA provides a solid foundation that could be improved with some tweaks. It repeals the ACA’s unpopular individual and employer mandates and penalties but preserves its well-liked protections for people with pre-existing conditions, the ban on lifetime coverage caps, coverage for children up to age 26 on their parents’ insurance and coverage of essential health benefits.
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The following are some of the most important changes the Senate GOP should make to the House bill:
Strike a Medicaid Compromise.
Provide More Generous Subsidization of Lower-Income Households.
Fix the AHCA’s Premium Surcharge.
Embrace Auto-Enrollment.
Limit the Tax Preference for Employer-Paid Premiums.
Provide More Flexible Use of HSAs.
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The conventional approach to health insurance keeps consumers in the dark about how their health care dollars are spent. Patients pay premiums every month and rely on insurers to cover their medical expenses, no matter how small or routine. Consequently, patients have little incentive to be cost-conscious. The more care they consume, the more value they capture for their premium dollar. Health Savings Accounts inject much-needed competitive forces into the health care marketplace. Expanding access to HSAs should be a centerpiece of any congressional effort to expand access to quality, affordable health care.
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You cannot do health care reform if it frightens patients who believe they will lose access to the care they are already receiving. This is why the Congressional Budget Office estimates showing tens of millions of people losing insurance as a result of what Speaker Paul Ryan and company were trying to do was so devastating. It’s that kind of reality that killed Obamacare after it became law. Whatever Congress does must ensure stability and continuity of care, especially among the most vulnerable populations during the transition period between what we have now and what comes next. Congress’ first concern when it comes to health care reform should be about producing better health outcomes.
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