Graham-Cassidy Repeal Bill — Just Plain Bad for Pennsylvania

Marc Stier |

As I write this, it is possible that the Graham-Cassidy bill to repeal the Affordable Care Act and make major changes to the traditional Medicaid program is already dying or dead. Two Republican members of the Senate, McCain of Arizona and Paul of Kentucky, have said they will vote against it. Senator Collins of Maine has announced that she is leaning against it. I’m hopeful that Senator Murkowski of Alaska will all announce that she is against it.

 And when that happens, I expect a substantial group of Senators will join them because this bill is truly dangerous to every state and the only reason it is even being considered is that Senate Republicans fear the short-term political costs of disappointing their base voters and funders more than they fear the long-term costs of doing great harm to their constituents. Once it is clear that there is no path forward to passing the bill, there will be no short term benefit to voting for it.

But first we have to kill it. If you live in Pennsylvania, that means calling Senator Toomey at (202) 224-4254 and then taking part in one of the efforts to encourage citizens in states with Senators who have not committed to voting no to call them. You can use this tool to do that.

The Graham-Cassidy bill is the latest Senate Republican attempt to not only repeal the Affordable Care Act, but also to radically transform the traditional Medicaid program. Like all the other efforts, it will lead to deep cuts in federal funding for health care to all states including to Pennsylvania, and will lead to large numbers of people losing their health insurance. Many of the details of the legislation have become known, but here we want to provide details about the impact on Pennsylvania.

The first short-term impact of Graham-Cassidy is to repeal the ACA marketplace subsidies and Medicaid expansion. This would eliminate the infrastructure under which Pennsylvanians secure insurance (and subsidies for that insurance) in the federally-run marketplace. In place of these provisions of the ACA, Graham-Cassidy provides block grants to the states to pay for a substitute for the ACA programs. However, not only is $243 billion less provided to the states between 2020 and 2026 than under the ACA, but the funding mechanism for those block grants directs more money towards states that did not expand Medicaid, like Pennsylvania, than those that did so. The result is that in 2026, Pennsylvania will lose, at a minimum $850 million in federal funding. And from 2020 to 2026, the total loss in federal funds will be about $6 billion. (The loss in federal funds could be even higher. Because part of the Graham-Cassidy plan is to replace the Medicaid entitlement with a per-capita cap, the bill, unlike current law, provides no additional guaranteed federal funding if a natural disaster, epidemic, or medical breakthrough leads to higher Medicaid costs.)

It is difficult to estimate the impact on the number of insured in Pennsylvania because we don’t know exactly how Pennsylvania would use the block grant money. The state would have to set up its own system for using that money to do some combination of limiting the consequences of the cutback to traditional Medicaid, keeping part of the Medicaid expansion, and subsidizing private insurance (and it would have to do all of this with less money than is used for these purposes under the ACA.) And that assumes that our dysfunctional General Assembly could agree with Governor Wolf or the next governor to actually replace the ACA. Given the current impasse, in which extremists Republican House members are blocking serious bipartisan negotiations on how to pay for our budget, no one should have any confidence that a reasonable health care proposal would be created in Pennsylvania.

Our best estimate is that simply because of the loss of funds, at least 150,000 and perhaps as many as 300,000 Pennsylvanians would lose insurance by 2026.

The costs of Graham-Cassidy become much deeper in 2027 and after because the block grant meant to replace ACA funds is eliminated while the per capita caps cut more deeply into federal funds for Medicaid. From 2027 to 2036 Pennsylvania will lose roughly $125 billion dollars or on average $16 billion per year in federal funding. Given our budget difficulties, no one should expect that any of that funding will be replaced with state dollars.

The impact of this loss of funding will be devastating. Analysts from the Center on American Progress estimates that 1.1 million Pennsylvanians will lose their insurance. We have previously pointed out that CAP estimates for Pennsylvania for legislation not quite as draconian as Graham-Cassidy were low. So our best estimate is that at least 1.3 million and possibly 1.5 million Pennsylvanians will lose health insurance by 2027, with the number increasing slightly over time. Over thirty million will lose health insurance nationwide.

Losing federal funds for ACA programs and Medicaid will, by itself, create a great deal of pain and suffering and between 900 and 4000 premature deaths in Pennsylvania. But there are costs, as well, to those who benefit from other provisions of the ACA. The Cassidy-Graham bill would let states waive the ACA’s prohibition on charging people with pre-existing conditions higher premiums, as well as its essential health benefit requirements. If Pennsylvania did this, people with pre-existing conditions might not be able to purchase affordable coverage at all and many health insurance plans would exclude pre-existing conditions or services like maternity care and substance abuse treatment.

And like prior Republican bills, Cassidy-Graham specifically targets access to women’s health care services by barring states from reimbursing Planned Parenthood for preventive health and family planning services for people enrolled in Medicaid.

The Graham-Cassidy bill is a disaster for Pennsylvania, as well as for the rest of the country. It is imperative that it be stopped.